Google has made some changes to the API's which has made the supplied YouTube application redundant. A new application is now available and should automatically update the YouTube application to the new one.
If the YouTube application does not update, then you can install the latest version via the DefaultApps application. Follow these steps:
1) Press the GREEN button to enter the Applications Menu
2) Select DefaultApps
3) Wait until the list of applications appear. Note, sometimes it can take up to 5 mins for the screen to appear.
4) Select Download under YouTube
The application will be updated. You can then exit the DefaultApps application and execute the new YouTube Application.