You can get working MP4 links for most YouTube videos by following the instructions in Torley's vidtut or you can use this tool:
http://www.zonkster.com/getmp4.htm
It'll return the same results as Torley's method without having to install Chitu's browser bookmarklet.
http://vodpod.com/watch/749678-watch-youtube-videos-in-second-life-second-life-video-?pod=torley
Enjoy!!