It seems petty for Google/YouTube to block content to Windows Phone's YouTube app. If they are have added the ads in the app as YouTube wants, then let them display the content as they want to rather than force a single style or technology.
Many many sites have various apps displaying the content in different ways and that's what cool and that's what's having a choice to choose the app we want to use and how we want to see the content.
If there is an ad requirement to show the content, well then ok, we get that. If the app developer doesn't have access to your ads API, then give it to them so they can adhere to your terms, but to restrict content on other issues masked by some lame, vague stretch of the general terms and agreements just piss off the end users and make you look selfish, petty and small minded.http://news.cnet.com/8301-10805_3-57598690-75/youtube-windows-phone-app-stirs-up-trouble-again/