Among the plethora of tools & services avilable today for downloading and conversion of  YouTube videos, these two seems nice and do the job perfectly. First they “download videos to your hard drive, and then convert to MP4 format,  finally you can add those converted videos to iTunes.

Windows users, try iTube, and Mac users PodTube [it basically works with Safari].

Once you gets the .flv video file, you can view it using VLC or convert to another format, Windows users, — Replay Converter | Mac users, — iSquint. For downloading YouTube video, you can use Oyoom, or try the Firefox extension called Video Downloader.

More info: step-by-step guide