When grappling, you basically have two options. You can make opposed grapple checks in place of your iterative attacks, and a success means you deal unarmed damage to the opponent. OR...you can attack with a light or natural weapon (unarmed strike counts as a light weapon, of course) normally. As in, using attack rolsl against AC. You take a -4 penalty for attacking in a grapple if you do this, though.
Now, from how I understand it, Flurry of Blows is its own special full attack action, so you could only use it with the second option (attacks with a -4 penalty against AC), but not the first (opposed grapple checks).
Reflex Saves: You can still make them while merely grappling without any penalty at all. Pinned is a little more questionable.
The condition listing says that you are held immobile (but NOT helpless). If you can't move, you shouldn't be able to make reflex saves. On the other hand, presumably you're getting some sort of "cover" from the guy holding you down, and I don't like the implication that HE can roll a reflex save and not even take a penalty. I've had a little experience with grappling in Jui Jitsu, holding someone pinned takes a lot of concentration on the pinner's part and you're extremely limited in how you can move without giving the other person a chance to break out of the pin. So umm...to sum up:
RAW (rules as written) answer: A pinned person gets no Reflex save; the pinning person gets one at no penalty.
Way I'd probably handle it: In the case of a pin, either both creatures get no save at all, or if the pinning creature attempts a save, the pinned creature is entitled to one at a penalty (probably treat Dex as 0 in terms of the modifer to the save) as well. I also might give the pinned creature a free attempt to escape the pin with a grapple or escape artist check after the reflex saves are resolved, too.
A while ago I remember a discussion about reflex saves & being asleep. I think that the answer was you could still roll to save. If I ruled that you couldn't save while helpless the one pinned is hosed (and maybe the one pinning does not get hurt at all). I am not sold on it one way or another yet, as it hos not come up at our table.
You can't really roll a reflex save while you're helpless, at least not in any of the varieties of helpless (asleep, unconscious, tied up) I can think of. However,
being pinned does not make you helpless. It says so explicitly in the link I posted above.