@brokencdplayer,
These web proxies work by downloading the pages for you, and then putting them back together and sending them to you.
The error is not due to anything on your computer, the proxy itself doesn't support flash video from Youtube. And most won't, because that costs them a lot more to provide and also is more difficult technically (to intercept the stream and reroute it). If you want to find one that works for youtube you should search for that specifically (e.g. "youtube proxy").
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