To paste in any code at all, you must use Text Mode. When you start to write a Post (or Page) you have a choice of Visual or Text.
See the tabs to the right in that little image?
Watch the Video
Instructions with Screenshots
1. Choose your video from Youtube
I’ve chosen this modern version of some ancient Roman music
2. Go to the Share Button
3. Choose the Embed button
5. I alter the embed code to fit my page. I’m changing it to 580p wide. Youtube fills in the height dimension for me
6. I copy that code and go to my site and wherever it is that I’m going to display that video. I make sure that I’m posting in Text mode
Paste in the code. Set the category. Save