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I've upgraded to version 3.0. My site is wordswithfriends.net

My administration panel looks like the following

Add New Post screenshot with toolbar

I thought there was supposed to be a special YouTube button which I don't seem to have. Adding media asks for URL + text and I just get a link not embedding.

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up vote 6 down vote accepted

According to the docs: http://codex.wordpress.org/Embeds as long as you have "Auto-embeds" checked in Administration > Settings > Media SubPanel you can paste in the youtube url and if it's on its own line the video should be embedded.

Alternatively you can wrap it in the embed short code e.g.

[embed width="123" height="456"]...[/embed]
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This used to have a nice interface, but it was removed because it was not clear enough (end-users should not have to know what "oEmbed" is). – Jan Fabry Feb 22 '11 at 11:09

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