I'm having the same issue. Video has sound but no picture but i have found this.
If i use safari on my iPad to access youtube and try to run the video i get the issue.
If i run a link to the same video from a chat forum in opens in a different player and the video works.
The thing i can think of is the java or browser update is some how causing issues when you use the web browser to display an embedded video.
Hope this helps