A. Machine Specific Settings(For every user) :

mms.cfg

    The mms.cfg file is a configuration file. When Flash Player starts, it reads its settings from this file, and uses them to manage its functionality, for e.g. to Auto update. 

    Assuming a default Windows installation, Flash Player looks for the mms.cfg file in the following system directory:
    Windows (Vista, XP, 2000 and 7) %WINDIR%\System32\Macromed\Flash

Note: The %WINDIR% location represents the Windows system directory, such as C:\WINDOWS.
   For 64-bit machines, the System directory is SysWow64, instead of System32. Note that Flash Player supports only 32-bit browsers on 64-bit operating systems.

   To disable the auto update edit mms.cfg for value AutoUpdateDisable = [ 0, 1 ] (0 = false, 1 = true)

   If this value is set to 0 (the default), Flash Player lets the user enable or disable auto-update in the Settings Manager. If this value is set to 1, Flash Player disables auto-upate, which prevents Flash Player from automatically checking for and installing updated versions. 

B.User Specific Settings :

Settings.sol
    When you created mms.cfg with disabled update, flash settings still show you that Auto-Update is turned when 
    browsed here :( http://www.macromedia.com/support/documentation/en/flashplayer/help/settings_manager05.html#118377 )
   
   Following details steps describe the process to identify and disable the Auto-Update visible on above web link:

  1.Open a web page that displays flash content. Right Click on flash content and select “Global Settings” as seen in the below image.
       
                                   

  2.You will be directed to following web page: http://www.macromedia.com/support/documentation/en/flashplayer/help/settings_manager.html as shown below:

       



   3.Select  “What are automatic notifications settings?" And following “Global Notification Settings” option will be available :

        
    4.On launching “Global Notification Settings panel”, following web page is
      opened: http://www.macromedia.com/support/documentation/en/flashplayer/help/settings_manager05.html#118377

        
   5.Uncheck “Notify me when an update to Adobe Flash Player is available” option and close the web page:


   
  6.Browse to following User specific location and check if Settings.sol file is available :
   "C:\Users\[User_Name]\AppData\Roaming\Macromedia\Flash Player\macromedia.com\support\flashplayer\sys\"

    To cross check this settings, login into another user account and copy the Settings.sol file the location pertaining to the current user.
    The desired result should be observed.

  7. The settings.sol file can be added in the package. Since the location of the file is per user specific, Active Setup has to be used(If the MSI is not    

      advertised).