|Here's how I fixed the problem:|
I uninstalled my video card drivers and checked to see if the buffering problem persisted without them. The problem was gone, youtube was buffering fast. Now, this was telling me that something was up with my computer the moment after the drivers were installed. Strange. So, I then decided to download the latest catalyst drivers for my card. Installed them, but the gpu was not recognized. Now, I made sure to download the right drivers from ati's website, which are: AGP drivers for all HD graphics adapters. The normal drivers don't work with the AGP versions of my card. So, I then uninstalled these drivers in favor of some drivers I've had on my hard drive since April of last year (v. 10-3). Installed the drivers, same problem with youtube. I then tried the latest drivers again to make sure something didn't go wrong during the initial install. No go, still gpu not detected. Uninstalled the latest drivers again, reinstalled version 10-3. Now, this time, I made a slight change during the install process. For some reason, ATI leaves files in the system32 folder even though you think you've uninstalled everything. Even running CCleaner didn't get rid of all driver traces. The install wizard informed me of about 6-8 files that were newer than the files in the 10-3 dirver package. You have the option of overwriting these or keeping the newest file version in favor of the older ones. I chose to "not" overwrite these newer files with older ones from my older driver package (v. 10-3).
Well, after everything was complete, I rebooted and then loaded up youtube. It works perfectly now! No problems with buffering anymore. Doesn't make sense does it?