I have noticed that a YouTube plays quite happily in a mixed playlist of tracks, albums and YouTubes but only if the YouTube is selected to play first. After that no other YouTubes play.
I tick "Enable YouTube Cache" in settings but notice that if I then move from settings to another screen such as playing now and then back to settings "Enable YouTube Cache" is unticked. I have tried it on both versions of the Android App and in Chrome on a windows 10 pc. It doesn't seem to matter if I select "Original" ; "Mobile" ; "New Mobile" or "New". Still the same result. "Enable YouTube Cache" unticks if I leave the settings screen.
I have the latest Software 14th Feb.
Cheers:)