The Samsung i8910 is great for watching DivX/XVid, including with subtitles. Natively supported and look brilliant on the AMOLED screen. For FLV its not quite as good, but has a dedicated youTube app available if that helps.
My current phone, the HTC HD2, is very good too. You need to purchase Coreplayer in order to play the vids, but once you do its magic watching them on the 800x480 4.3inch screen.