jason67 wrote: I just don't know what to make of the script that appears and asks whether to allow it or not.
You mentioned youtube, could users potentially upload malicious videos to be executed?
Ah, you were referring to this dialog box. This is not actually a script. If you look closely, you'll see that it's just YouTube's extensive description of the video. The initial "Temporarily allow (address) swf/" .. and the end "(<EMBED>, application/x-shockwave-flash)" is NoScript asking you if you want to allow that particular object or application -- in this case a Shockwave Flash, or swf, object. What's in between is not JavaScript code, it's information about the video. Look closely: "length_seconds=152", "url=(location of this video)" "title"Olivia+Newton+John", location of the thumbnail, various authors and view counters, etc.

As for malicious uploads, I don't immediately see why not, but I'm not a YouTube uploader, and only a once-in-a-while viewer. So I don't know what, if any, vetting they do for malicious code, and I didn't immediately see a link to it in their Help.
I'd welcome input from anyone, support team or user, who has information on whether YouTube scans uploaded material in any way.
My fall-back (defense in depth) is to use a virtualized environment for the browser, so that any malicious code that does load cannot escape the virtual container, or "sandbox", and therefore can't write to your hard drive or execute code on your machine. Also good common sense is not to have such an object or window open while you have any sensitive site, like your online bank, in another window, even sandboxed.
There are many virtualization solutions out there, some of which create a cloned copy of your entire machine, pretty much. Much lighter is
Sandboxie, which merely clones the browser, Fx profile, and other needed files, including the necessary Windows files. In its safest setting, this sandbox is emptied every time you close the browser, so any malcode would have written to the *cloned* system and Registry files -- which get dumped.

Your *real* hard drive, system files, etc. remain untouched.
This site can't officially endorse or be responsible for another party's product, but fellow support team member Alan Baxter and I like to rely on Sandboxie when we're asked to visit questionable sites, and/or to disable NoScript, for investigative purposes. It comes in both nagware and payware versions, so you have the choice of buying or putting up with the nagware screen. Again, that's just a personal opinion, not supported or endorsed by this forum, but you might like to check it out along with other sandboxing solutions (ZoneAlarm has one now, I understand, in one of their paid versions.)
Hope this helps, and looking forward to feedback on the issue of whether YouTube takes steps to prevent malicious uploads.