Until you said it worked on XP, I thought it may be a problem with the video itself. Hmmm, maybe the problem could also be with the YouTube player itself, which, I guess, could explain that the videos is bugged after downloading, too...
Since you have FF4, install Greasemonkey
and then this great script
to replace the YouTube player, then see if the videos play any better.
Sorry if this isn't exactly what you expected from someone offering help xD