Stearic acid was used to modify the surface of a mixed flame-retardant powder consisting of aluminum hydroxide and ammonium polyphosphate by an uneven nucleation method, aiming to improve its dispersion in a vinyl resin matrix. This study investigated the effect of stearic acid dosage on the powder's surface modification, characterized by infrared spectroscopy, activation degree, and laser particle size distribution. The dispersion of the modified powder in the resin matrix was evaluated by measuring the system viscosity, scanning electron microscopy (SEM) images, and bending performance. The results indicated that when the stearic acid content was 1%, the powder exhibited the best overall coating effect, with a uniform particle size distribution and an activation degree of 73.6%. After the composite material was added to the resin, the system viscosity was 923 mPa·s, and SEM images showed good dispersion of the powder in the resin matrix. The cured resin demonstrated a bending strength of 41.86 MPa. However, the flame retardancy slightly decreased, with the limiting oxygen index (LOI) dropping from 24.6% for the unmodified sample to 24.0%. When the stearic acid content exceeded 1%, the powder's particle size increased dramatically. Although the activation degree also increased, the improvement was not significant. The addition of the powder to the resin resulted in a higher system viscosity, and the flame retardancy deteriorated sharply, with the vertical burning rating dropping from FV-1 to FV-2. Considering flame retardancy, mechanical properties, and processing performance, the composite material with 1% stearic acid demonstrated the best overall performance.