Strictly speaking, it's a wyvern, Jon!

To end any confusion about the Union Jack(or cause more), it comprised originally St George's cross (red) on top of St Andrew's saltire (white on blue). The white border to the red cross is there because of a peculiarty of heraldry: white and yellow represent siver and gold respectively, and you mustn't put a "metal" next to a colour, or a colour next to a "metal". In this case, the red is separated from the blue ("infimbriated") by a thin white (silver) line. It's OK to have this touching the white saltire, as they're the same colour. When Ireland was added to the Union, the saltire of St Patrick (red on white[?]) was added to the flag, another bit of heraldry came into play: the two were "counterchanged", which means the diagonals were split cornerwise and north-south, east-west. Each bit was coloured red or white, alternately. But now you'd have had red against blue - not allowed - so the red was imfimbriated with white. To balance the appearance, the other white bit was made wider. And that's how we have the Union Jack we know and love (or otherwise) today.

BTW, the study of flags is vexillology, not heraldry, but blame James I/VI, not me!

Steve