I would think the best way to utilize a flywheel energy storage system would be at each wheel to recover the energy lost as heat during braking. If you could design a coupling or a set of clutches that would engage when the brakes are applied, then disengage as the vehicle stops, then during acceleration the flyweel engages again to assist the engine.
I think there are a few cars that such a system has/is been used on, but I dont know how well they work or how reliable they are.