Before you do anything with the floor, you really need to resolve the flooding issue. Even a home that is in a lake basin can be setup to not flood. I'd strongly recommend discussing how to alleviate the flooding problem before making a decision about flooring. Otherwise the cart is pushing the horse.
I wouldn't spend 2 cents on the flooring if the decision revolves around flooding. Spend the 2 cents on the flooding and then decide on flooring based on aesthetics and what you like.
If in the last straw, you are forced to deal with flooding, Mike's right on, but your basement will never be a great living area, and you'll always wish it were different.