http://www.youtube.com/watch?v=iqQkGPNTbc8

You can now click to pause/play at last with a cool little animation

Good feature, smart move: if users get used to pause by clicking, Google's video ads CTR should increase dramatically: I'm seeing more and more Google ads using the Youtube player that direct to the advertised websites when you click the video instead of the play button.

Admittedly, when you click on the embedded video it will trigger a different action (opening the video on the YouTube site, as usual), so this may cause mode errors* among users. By the way, when I was watching above video embedded here and clicked on it around half-way through, then the new video opening at YouTube was correctly positioned half-way through, too... was that some kind of coincidental click by me/ or is that new/ old?

* Mode error: http://www.usabilityfirst.com/glossary/main.cgi?function=display_term&term_id=655

Maybe old but cool trick: if you edit video and in the tags section add yt:quality=high, the video will default to high quality right away and will take the whole width of the Youtube page without changing the URL (see here youtube.com/watch?v=8YtRLkY_ZMk)