|Take into account what you know:|
-Fully buffer YouTube videos are choppy when played online (using flash player)
-CPU usage is going to 80% when using flash player
-Same videos downloaded play fine with VLC
All that tells us it is not your video card, but your CPU and it's inability to handle the videos/Flash player. Upgrading your video card may help in other areas (playing games and such), but you won't see a difference with the Flash videos.
If you need more convincing, just search google for "flash videos cpu" and read about all the people with problems.
You are using an older, comparatively low powered CPU. That is what you need to upgrade. Unfortunately, that means you'll probably need to also upgrade your motherboard, so plan on spending a minimum of $175. may be more worth while to look into a new computer. Pretty much anything currently available that isn't a "netbook" or "net top" will be able to play Flash videos.
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