TubeSock grabs YouTube videos from the web and copies them to your video iPod, Mac, or PlayStation Portable. TubeSock knows how to convert the video using the codecs and bitrates best for each device. It can even add the video to iTunes for you.
It is not free. Trial versions available. TubeSock costs $15. Until you register, TubeSock will convert only the first 30 seconds of a video.