The basic flaw of Willy Loman's life can be summarized in one word: denial. This is not just the obvious denial of reality that has turned him delusional, but the denial that he has both used, and suffered from, from the earliest stages of his life.
As a child of four, Willy is denied the chance to have a normal childhood. Abandoned by his father, he is raised by his older brother, Ben. Similarly, he is denied a healthy growth when Ben also goes away to find riches in faraway lands.
As a younger man, Willy Loman recognizes his talents in woodworking, construction, and he even displays an ability to understand nature. Again, Willy denies himself the opportunity to test his skills in the things that he loves and opts to try the growing, quick-money making techniques that are offered in the newly born field of sales. Summoning the legendary successes of a late salesman named David Singleman, Willy seriously assumed that his luck would turn out the same way. He basically lived his salesmen years following the dreams that were conquered already by another man.
As a middle-aged man, Willy denied his children to find themselves. Encased in the tendency to live vicariously through the successes of his children, he imposed goals and dreams on them, including his own vision of life: One in which being well-liked and good-looking will surely grant your success. Hence, he lived with this false and superficial assumption, denying himself reality, and drowning even further in a life with no solid ground, nor anchoring root.
Now as an elderly man, Willy is completely devoid of common sense. He has become so used to live in a dream that the dream has now become his reality. The momentary lapses of reason that do surface within him in the play are immediately interrupted by either a sudden flashback, a "what if", or by the apparition of something, or someone, from his past. In the end, Willy is lead to his death precisely because, during a sudden moment of realization, he concludes that a lifetime of dreaming has done nothing for him. This is evident in Act 2, in the scene where Linda finds Willy feverishly planting seeds in the garden in the middle of the night, to which he responds:
I've got to get some seeds. I've got to get some seeds, right away... Nothing's planted. I don't have a thing in the ground.
Therefore, it seems as if the tragic flaw that has permeated throughout Willy's life without fail has been denial in all of its manifestations. The fact that he has been denied a normal childhood rendered him feeble as a father, and prone to a great need of validation. Having failed at it, he then built a perfect world of his own where he would imagine success and greatness. He failed at it, and now lives in a fantasy world. All this for denying himself the chance of knowing who he really is.