Just a heads up. YouTube has switched their default embedding option from an object to an iframe.
If you snag the embed code from the video’s popup panel you’ll still get the the Object code. It’s only when you’re on YouTube’s site and click YouTube’s Embed button that you’ll get the iframe code.
The iframe option is supposed to improve compatibility with mobile devices. Unfortunately, if you paste that code into WordPress, WordPress will strip it out when the page renders and you won’t get any video. (Tested with WordPress 2.9.2 and 3.04.) You’ll need to check the box next to “Use old embed code” to get the object code:
You can also put the video’s YouTube URL on a line by itself and WordPress will automatically embed it. You can set some options by adding them to the URL. Instructions here. Or just use the Embed button (it looks like a green piece of film) which has a user interface for setting the size, autoplay, and other options.