I only now installed the new MP4 libraries in TFF (d'oh), and playback performance appears to be about the same, though I no longer see any errors about playing video. So it appears that the MP4 libraries are integral to watching YouTube on TFF in modern day.
In other news, I've taken to switching all my TFF user agents to iOS Safari (iPad). YouTube now works much snappier, and defaults to 360p in-browser, with little to no lag. If higher resolutions are desired, I can just activate QuickTime Enabler in 480p, 720p, or 1080p.
A nice added benefit to this, is that you retain the speed controls, can view the video in its native resolution in an empty browser or QuickTime window (which greatly helps performance), and now have the option of directly downloading the video MP4 file, via "Save Video As...", all from the context menu. It's really, really nice.
So, my new recommended strategy for YouTube playback is to install
QuickTime Enabler and the
MP4 libraries in FPR14+, and activate the iOS Safari (iPad) user agent in the application preferences, under the TenFourFox pane. Afterward, you have the freedom of playing around with the video window and choosing exactly how you want to watch it. On top of this, uMatrix and our TFF tweaks continue to do their part for performance contributions, but even so...
We've come a long way.