The way it is done now is a bit of a hack. So there are problems with it - like it won't show up in the preview.
When you are writing a post, put in "{ embed }xxxxxxxxxx{ /embed }" (without the space or the quotes). Replace "xxxxxxxxxx" with the
goofy youtube number. Something like gDd-EYbXNqU - when you are viewing a
video, the goofy youtube number usually appears right after "v=". Sometimes there is a "&" so the goofy youtube number ends just before the "&".
Have fun!