Do you block cookies? This setting is saved in a cookie.
If you cannot solve the immediate problem - youtube defaults to HTML5 for recent browsers since some weeks ago. "Recent" means "Version 36" in case of firefox, iceweasel and co. You could trick youtube into thinking you have firefox 36 by overriding your user agent string: Edit or create a string value "general.useragent.override" in
about:config with the following content:
Code:
Mozilla/5.0 (X11; Linux x86_64; rv:36.0) Gecko/20100101 Firefox/36.0
Replace "x86_64" by "x86" if you have a 32bit system.
This will be global, for all sites. Recommended, but requires firefox addon: Do it site-specific, only for youtube, for example with the addon "UAControl".
There is no guarantee that youtube works correctly, because it might expect some modern functions from the browser it does not have, or behaves buggy.