A couple of things I changed to make use of the new iframe code for embedding Youtube videos on the website. The new code supports both Flash and HTML5 video. Only users of supported browsers who opt into the Youtube HTML5 trial will have the HTML5 video option available.
<iframe width="690" height="419" src="http://www.youtube.com/embed/<VIDEOID>?wmode=transparent&modestbranding=1&rel=0" frameborder="0" allowfullscreen></iframe>
Using embed instead of ‘v’, which goes hand in hand with wmode = transparent. What this does is allow divs (drop down menus) to overlay on top of the iframe/video.
modestbranding to reduce Youtube branding.
rel=0 if you do not want to show related videos (which may be a distraction from your web page content) after the user finish playing your video.
