1. Addon for firefox: https://addons.mozilla.org/en-US/firefox/addon/83149 (Need Version 1.3.2 or higher) 2. Join HTML5: http://youtube.com/html5 3. Play a Video (IE: http://www.youtube.com/watch?v=GroEJy45cVc) Parole will Load inline as its plugin form, but won't play automatically NOR will it allow you to press play. Totem works fine however.
Also note that using a media player inline rather than flash cuts the system resource usage by 20% or more. See also why I don't like using flash in Youtube: http://www.google.com/support/forum/p/youtube/thread?fid=66ab45eaf4099afe000482f668b82432&hl=en
Since the browser-plugin has been discontinued quite a while ago already, I'm marking this as invalid.