The pilot reported that during takeoff, he climbed to about 20 to 30 ft and raised the gear. At about that time, the aircraft began to sink. He stated that he pulled the power off just before the aircraft hit the ground a few miles from the airport. An investigation revealed that the flaps were not damaged, as if they were not extended during impact. However, the flap control was found in the down position. The flaps were found about 20 degrees down and the flap indicator was indicating about 1/3 down. The investigator capped off a broken landing gear hydraulic line and filled the hydraulic reservoir, but the hand pump would not operate due to air in the system. The engine was then run, and after that, the hydraulic system operated normally. The pilot suspected that the flaps came up when he raised the gear after takeoff. This aircraft was equipped with a flap system that was to be set either full up or full down. An intermediate selection would not insure a positive selected position.