B737 Captain reported encountering wake turbulence on landing from a preceding aircraft that disconnected the autopilot and may have caused a flap malfunction that also led to a low terrain aural alert.

Narrative

I was the PM for our flight to IAH. The flight was uneventful until our final approach. During the base leg vector to Runway 26R; we had light turbulence with wake from the preceding aircraft. We were configuring for the final with the flaps at 10 degrees. The autopilot disconnected and we momentarily went into CWS. While in the turbulence lining up for final I reset our Flight Directors (FDs) and re-armed the approach. The First Officer (FO) called for gear down and flaps 15 shortly before calling for flaps 25 and 30. I did the landing checklist and held at flaps because the indicator appeared to show 28 degrees. I asked the FO how the controls felt and he advised me that it felt normal. I verbalized that the flaps couldn't have blown back up because they didn't appear to show 30 and we selected the flap position well within the flap limit speeds. At approximately 200 AGL on glideslope we got a too low terrain aural. I had already triple-checked the flap handle was in the 30 detent. The gear was down. My concern for doing a missed approach was that the flaps would get asymmetry or potentially now come down and we end up doing a non-normal approach. I told him to continue the approach and land. Of course due to the indicator; I wrote up the flaps and aural warning.