Google was previously just testing Chromecasting from embedded YouTube videos (as opposed to those on YouTube.com), but it looks like the feature has now been rolled out to virtually all videos. Google's support page has been updated to say that "most embedded YouTube videos" are now supported for casting.
We've been doing some testing, and every embedded video so far has been compatible with the Chromecast. The point of saying "most" embedded videos might be a nod to the limitations on private, live, and non-mobile videos on the Chromecast in general.
So, that's just more cool stuff the Chromecast can do. It took a few months, but it's getting to be a capable little device.