from
www.channel1.com/workingphotos/flash_redeye.html quote:
"Red Eye" is a vexing problem with an interesting cause: Subjects' eyes glow red when light reflects off the blood-rich retinas at the backs of their eyes. The problem is most common in flash phototographs for two reasons. First, most flash pictures are taken in relative darkness, when people's pupils dialate (open wide) to let in more light. The wide pupils also allow more light to reflect back out to the camera.
Second, flashes, particularly on small cameras, are often very close to the camera lens. The light from the flash that hits the subjects' eyes reflects straight back to the lens. When the flash is farther from the lens, the reflection from the eyes doesn't hit the lens.