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Using drupal 7.17 and dev versions of media_youtube media, file_entity modules and TinyMCE 3.5.7 inserting videos doesn't work.
I've tested this in both Panopoly RC3 and in a vanilla installation of the In the current build of Panopoly the outcome is the preview image being included in the final content. On a fresh install where only the supporting modules are included the result was the word "false" being printed.
When using CKEditor 184.108.40.20647 everything works like a charm in both Panopoly and in the vanilla.