Actually gas mileage should improve on flat freeways, but not in the city.
The flywheel will give so much inertia that it will require less energy to maintain your speed. But if you are doing a lot of passing and accelerating, then that's what's gonna get ya.
When I put in a 11 lb flywheel in my MR2, replacing my 20 lb stock flywheel, I lost around 5 mpg, seriously.