Could you try disabling graphics hardware acceleration? Since this feature was added to Firefox, it has gradually improved, but there still are a few glitches with some graphic cards/drivers.

You might need to restart Firefox in order for this to take effect, so save all work first (e.g., mail you are composing, online documents you're editing, etc.).

orange Firefox button or classic Tools menu > Options > Advanced

On the "General" mini-tab, uncheck the box for "Use hardware acceleration when available"

Does that make any difference?

Thank you very much for your reply.

I've tried what you recommended, but the embedded video thumbnails still appear glitchy.

Any ideas? Or could this be more of an issue outside of Firefox/Flash?

Seems to be an issue with flash as it showed up as soon as I updated to the latest version, the weird thing is the problem mainly occurs with embedded youtubes. if you check this page http://www.everythingisterrible.com/ The youtube embeds stutter while the ones from vimeo are okay.

I've had this occur on two different computers both with Windows 7 64 bit

I was able to fix it by editing the configuration file as outlined here http://forums.adobe.com/thread/1018071?tstart=0 (scroll to the end) However, I after testing it I decided to revert back as you are pretty much disabling a security feature designed to prevent malicious attacks to fix something aesthetic. I'll probably report the bug to adobe or wait for a fix but this will get rid of the issue for now.

Good feedback, thanks.

Thanks jscher2000, This worked for me. Useful information. My videos appear to be working again.