Good to know that you found a solution
However, there is really no need to do manual installation. There is indeed something broken, which I will fix on Monday. Even before that is fixed, you can still make it work. Try these steps:
1. Unregister/delete current installation of flvsplitter.ax from MC12 installation folder, if it is there. Do this WITHOUT MC running. If it is not found in MC12 folder, you may have previously manually installed it. In this case you should unregister it.
2. DOWNLOAD one video from Google video or YouTube if you do not already have a flv file on your local drive. Play the video ON YOUR LOCAL DRIVE, NOT directly from YouTube site. MC will automatically download and install a correct version of FLVSplitter.ax and other needed filters, and start playing the file.
3. After step 2 is successfully completed, you can now play a YouTube video directly from YouTube site, and you will not have to repeat step 2 anymore. Step 2 is crucial because of the bug I mentioned.