There's a couple of ways to do it, but I think the easiest and most effective way is to use "Insert Video"
insertvideo.JPG
When you press it a dialog will pop-up and ask for the URL of the video you want to insert, copy the URL of the video you want to insert and paste it into the dialog box
insertvideodialog.JPG
Click on "OK" and the video will be inserted into your post (not my video, just something I randomly pulled out of the youtube thread)
The YouTube and Vimeo buttons will also work, but they're more cumbersome, and the videos that are inserted are smaller in size.