palegrayforguilt, can you provide a specific link or example please?
YouTube changed the format of their embed code recently. WordPress.com has a special filter so that if you paste that embed code into an article, it'll get automatically converted to a [youtube] shortcode rather than stripped out (as embed codes normally are). YouTube's change broke that feature. Previously published posts weren't affected, but if you tried pasting an embed into a new post in the last week it would often fail.
As far as we're aware it's fixed now, but if it isn't working for some videos we'll need to see examples in order to fix those.