Try this, it just works:
<object>
<param name="movie" value="http://www.youtube.com/v/[VIDEO_ID]"></param>
<embed src="http://www.youtube.com/v/[VIDEO_ID]" type="application/x-shockwave-flash"></embed>
</object>
Edit:
It works because Apple replaces the html tag with an embedded native movie player that can play the youtube video.