well what the shapeFlag hitTest does is it gives you an x and y value to check for hitTest, rather than a hitBox
MovieClip.hitTest( x, y, shapeFlag);
But when dealing with circles (which yes gets complicated, and I actually have never done this before)
you would have to do something like this:
object1.hitTest( (object2._x - object2_radius), (object2._y - object2_radius), true);
Now this code wouldn't work in a million years if you tried it of course but its an example. You need to have a code that gets the distance between the 2 objects that are going to collide. Then when that distance is, say, the distance of the radius of both of the 2 objects (say each circle is 20 wide, or radius of 10, then that distance would need to be 20) Then you do you're execution.
Again, I hope this helps, it is a bit confusing I might not have explained it perfectly but its headed in the right direction. Good Luck :D
