Using a microcontroller ADC to measure a 4-20mA sensor
Yes, just connect the negative end of the resistor to the microcontroller analog ground.  This is one advantage of a current signal.  Since the microcontroller supply and the flow meter supply are isolated from each other, you get to pick one point on each where you can connect them together.

While your calculation of 165 &Omega; is correct, I would use just a little less to be able to sense some overrange.  150 &Omega; might be a good value.