Well, I mean, there's logic (and irrationality) to both sides of the debate.
On the one side, Detroit was actually a pretty decent D throughout the year.
4th overall, actually, according to Football Outsiders. They weren't elite by any means - it was a down year for defenses across the board - but they were amongst the best *this season*. And, regardless of talent available on Green Bay, Flynn *did* actually throw for 6 TDs and 400+ yards. It's a bit like the '72 Dolphins debate: they faced lesser competition, sure. But others have faced quite a few cupcakes too, and they haven't gone undefeated. So it's an accomplishment you simply can't take away. And, as others have said, you have to make smart decisions to have those numbers - while luck certainly plays a part, you can't chalk it up *all* to luck. There's talent there.
However, one-(or two-)game flukes do exist. There's a plethora of them; to be recent, one only needs to look to Denver. Even San Francisco: Alex Smith looked world-class against NO, but very average against NY. It's even an argument against everyone's favorite whipping boy, Chad Henne: "sure, he *can* have great games. He's just incapable of sustaining that performance." And Flynn's circumstances are about as perfect as they can get: groomed for four years behind one of the very best QBs in the game, within the same system all along, playing with one of the best receiving groups of the NFL.
The fact of the matter is, just like with any other player, we simply don't know. Does he have the potential to be great? Sure, but most everyone that even makes it to the NFL does. Has he proven enough to be a "known commodity"? Of course not. If he starts for a few years and continues to play at a high level, then yeah. Even then, though... there's a Mr. Carson Palmer on line one. Should his "pedigree" prevent a team from signing him? Nope. He wouldn't be the first or last player to slip to the cracks.
But the main question: should the Dolphins sign him to what, by all signs, should be a monster contract? Or as the OP puts it, should we "destroy our cap" by signing him and risk him busting? Well, that's why they play the games.
My personal opinion: Philbin will give his judgement on the kid. It will bear the most weight, as it should. Still, the team should protect itself (like it does with any other player) and put as much performance clauses in his contract as possible. He would have some of the same advantages he had in GB if he comes here, so it's worth it to take a shot.