I believe there is some debate on this issue, based around the "you can flurry when using an unarmed strike or monk weapon" text.
Grapple checks are not a monk weapon, and it's debatable whether or not they count as unarmed strikes (although they do the damage of your unarmed strike).
Interpretations I've seen:
1) Grapple checks cannot be combined with a Flurry in any way.
2) You can use a flurry of blows to initiate the grapple, but not once the grapple is established. (i.e. the initial touch attacks to start a grapple can be done as part of a flurry, but the flurry ends once the grapple is established.)
3) You can flurry while in a grapple, but only if you are using the "attack your opponent at a -4 attack penalty" option, instead of making grapple checks.
4) You can flurry within a grapple, and use the flurry attacks to make grapple checks. Grapple checks are close enough to unarmed strikes to count.
I think option 3 is probably the closest to RAW, but I think a case can be made for option 4 (and is the ruling I prefer). Monks aren't exactly overpowered to begin with.