"Flashing" is a term we use for the layer of metal surrounding a chimney to stop the rain/snow from sneaking
water in around it. I've also heard it used for the metal used instead of roofing shingles in what I would call a "valley" in a roof for the same reason. (we've got several "valleys" in our roof and I would never design a roof needing one if it was at all possible to avoid in a climate such as mine!!!)
My understanding of cob buildings is that when indoor humidity is high, it is absorbed by the cob and when it is low, it is given off, which makes living in the building more comfortable. Yes, a "vapor barrier" (paint can be a vapor barrier - which is why cob building strive for natural, "breathable" finishes) would stop this from happening and that would be a bad thing.
The "flashing" I referred to is horizontal between the rock foundation and the cob. Water is neat stuff and it can move vertically against gravity (just ask any tree!) The ground where I live is much wetter in the winter than the volume of water made up of the "humidity" in the house. Yes, you want to also do everything you can to keep the foundation as dry as possible by directing water away from it, but a place on Vancouver Island called O.U.R. Eco-village has done a lot of work to get cob buildings and strawbale buildings approved by the authorities and somewhere in that process, I was
led to believe that this horizontal waterproof layer was recommended. It would have been punctured by something like rebar to make sure that the building stayed tied to the foundation as we're also in an earthquake zone. I think the rational was that if too much moisture soaked up from the ground into the cob, then the cob would be too wet to have the indoor humidity absorbing affect it is supposed to be good at.
I have never built with cob, but as my son's girlfriend said last night, she "can't believe the engineering shit I've absorbed just from being around engineers". Hopefully one of our cob experts will chip in. This is climate specific - my sister runs a humidifier in the winter in Ontario - we run a dehumidifier! Painted drywall simply can't absorb the quantities of water in the air when we get a month of rain (let alone 3 months which has happened some winters.)