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macrumors 65816
Original poster
Can Apple TV play the new HD content from youtube?
If not then maybe an update soon.

Good and Bad news:
No it can't.
YouTube's widescreen videos do play on tv. They now fill the entire screen, versus the square videos that we used to get.
I'm sure it's a matter of time before the tv firmware is updated and we get access to the HD videos on YouTube.