AFAIK you cannot change brightness/contrast when embedded in a webpage as described here:
viewtopic.php?f=16&t=54753#p180878
You can embed VLC into the browser though, however if you just want to be able to playback YouTube videos you could just paste the YouTube URL into VLC itself (format:
http://www.youtube.com/watch?v=VIDEO_ID where VIDEO_ID is the ID).
Alternatively if you have a working VLC embed on a webpage, you might be able to copy and paste the actual FLV video link (get_video one - can find with e.g. FlashGot plugin or Easy YouTube Video Downloader or Keepvid.com) into the MRL field.
Arite.