To embed a video, just grab the whole Link and click the Video icon, next to Insert Image on the post screen like this
[video]http://www.youtube.com/watch?v=S3-nEcmd2NE[/video]
This version also supports the sites listed below.
YouTube (www.youtube.com)
GoogleVideo (video.google.com)
LiveLeak (www.liveleak.com)
Veoh (www.veoh.com)
GameTrailers (www.gametrailers.com)
iFilm (www.ifilm.com)
Revver (www.revver.com)
BrightCove (www.brightcove.com)
MySpaceVideo (vids.myspace.com)
CollegeHumor (www.collegehumor.com)
vSocial (www.vsocial.com)
Guba (www.guba.com)
Glumbert (www.glumbert.com)