YouTube App Giving You Trouble? Try YouTube Mobile.

"Go to www.youtube.com and play your videos from the website. Not every video will work because the search results provides videos whether they are flv or h264. This is clearly a work around (hack) till they get this fixed, but at least you can get your youtube fix."

Recently, I made a similar discovery; namely that the mobile version of the YouTube site works fine on the iPhone (as long as the video has hit their H.264 converter).  The advantage to using the YouTube mobile site is that you have access to any videos you've favorited on your computer and your subscription videos are available.  The biggest downfall I find for the YouTube app on the iPhone is that it's in no way tied to your account, so if you find something you like on the desktop and want to share it with others, you have to "re-find" it on your iPhone.  Not exactly efficient.  Hopefully that's something that will be fixed soon because it does keep me from using the YouTube app more regularly.