No matter what approach you use, YouTube simply will not be practical on the DS. I have a 1/2 working YouTube DS app on my DS and I've just given up; you type something on the virtual keyboard and then it sends a request to a PHP file on one of my sites which retrives results from a YouTube search query, you pick a result and it sends another request to a different PHP file which downloads the YouTube video and stores it as an FLV file, then a link to that FLV file is sent to online-convert.com which puts your file in a que, after what seems like 10000 years of tedious waiting you finally get your DPG file which can be played with moonshell, woop de doo. Did I mention the memory leaks caused by ky_getUrl? If you send too many requests you get the "guru meditation error" which most of you know from DS Organize.
Even if it did get released YouTube are constantly changing their server stuff so YouTube DS would break after a while unless someone decides to maintain the world's most unusable program.
Call me when the 3DS is hacked.