Hi, Phil-
Your points are well taken. Certainly, a CDN will handle the BW concerns, if a site owner is prepared to go that route. The alternatives you mention will certainly work, too, with the added benefit of not having to content with a 5 second ad on the screen.
But I think your concerns regarding YouTube doing poorly doesn't really hold water. If you self-host, either via CDN or on Vimeo, you'll undoubtedly be promoting the video in some fashion, on and off-page. Presumably, you'd do the same if embedding a YT video. So I see no difference in terms of traffic generation. Perhaps if you're depending upon YT for your traffic, but really, how many people do that? As for YT outranking the content, I would say if that happens, the content probably either went viral or there wasn't any meaningful promotion of the webpage undertaken.
We did a hangout the beginning of July, and embedded the YT video on our website. Our page is in the #2 slot, while the YT version is on the bottom of page 2. Aside from a couple of social mentions, we did very little to promote our page. http://www.google.com.mx/?gws_rd=cr#bav=on.2,or.r_qf.&ei=GJYGUtuzOuiqyAHr7IGIAQ&fp=7a8e48b9e5b6684f&hl=en&newwindow=1&pws=0&q=matt+siltala+on+infographics&sa=N&safe=off&start=10
Granted, the views it garnered are hardly noteworthy, so the example is far from definitive. But I'd wager that even if it had gotten 1,000+ views by now, we'd be able to easily outrank it. 30,000 might be a different story - 300,000 probably pretty tough.
My point is, while I accept that your options are good ones, and quite likely, are better in some circumstances, I think YouTube is still worth thinking about for some circumstances, too.