Installation is simple. Just visit its home page and bookmark the bookmarklet link by right-clicking on it and selecting the bookmark option. If you like, you can drag the bookmark onto the Bookmarks toolbar for easy access.
If that sounds confusing, developer Christoph Schellen offers a small video that demonstrates how the bookmarklet works. He also provides a Greasemonkey script for Firefox users who use the Greasemonkey extension.
Unlike Google Video, which gives you the option to download the video in any of three formats (AVI, MP4 for portable devices like the iPod, and FLV), YouTube only offers FLV downloads. While both xine and VLC can play FLV, I had a very low success rate at playing downloaded content with these tools. The ones that did play back had no sound. You may have better luck if you convert the video to another format. Take a look at Manolis Tzanidakis' article to convert FLV files into AVI format.