I followed this guide: http://en.support.wordpress.com/videos/youtube/ but I am still experiencing problems with youtube embedding. I can get the video to show up if the auto embed feature is enabled and I only use the direct link without any embed tags, but I can't get it to work with any embed tags such as the &rel=0 to disable related videos from showing at the end, which is what I really want. Even if I turn off the auto embed feature I get the same result.
Any ideas? Could it be a theme related problem? I'm using the business lite theme from Cyberchimps.