I guess all in all I understand what you are sharing, but wanted to clarify somethings first...
1.You want video in flash to be played the same way as in html5, playing while loading rather than play after completely loaded (Yes this is how it use to be in older TW versions... no one wants to wait 10.. 30 seconds... or what ever for a video to fully load before playing)
2.You want video in H5 to buffer a bit longer before starting to play (This would help to ensure the video doesn't stop part way thru once or many times to buffer)(testing locally doesn't always give you a true understanding of how it will play because local files always load faster than files over the internet)
So briefly speaking you want the video to play smoothly without waiting for a long loading time, right?
I tested with local video files,19MB, it starts to play when the scene is full loaded. Could you please send me a sample you made?
Anyway, we are studying how to make a better video playing effect.
3.Youtube video doesn't has play/pause button, Youtube autoplay, html5 Youtube support.
Some of Youtube serurity settings doesn't allow us to add these features, we are trying to find out another way.(Youtube use to have video controls in older TW versions, youtube doesn't offer or currently autoplay, and are you saying that html5 doesn't support youtube? Because I have seen html5 with youtube in other applications, I really need html5 to support youtube as it would solve most of my problems)
4.Flash video with initial control button