It can help if you add tags/keywords to it when you first upload it, and also if you write a blurb or short description when you embed it onto your site, that will also increase saturation and content of your website. Otherwise just having the video there won't really do too much for SEO.

I think that adding video can help pull in more readers, or at least minimize your site's bounce rate. I'm starting to put videos in my blog now, YouTube clips related to my theme, so I'll see if the bounce rate really does go down. The idea is, when you click on a video, at least you'll stick around for a few seconds, and who knows, you may get more interested in the site if it hasn't already gotten your attention.

That is a great point, if you make them interesting enough to watch I suppose.

Hi,
Off course videos increases the page ranking and keywords searching.
Because it is a way of advertising. By a videos a numbers of peoples comes on your sites, and indirectly a more traffic comes on your site.
I am SR.SEO in my company Infomist, You can get help by coming on my site.
http://www.infomist.com/.
You can link with my site. The details are given below:

URL : http://www.infomist.com
Title: Web development & Web designing | Web development & Web outsourcing | Web outsourcing | Drupal services
Description: Infomist is the most leading company and the largest Web developer’s site on the Net. Infomist provides web development, web designing, web hosting and web outsourcing services around the Globe. Infomist web developer’s team use most effective tool called Drupal for the Web development.

Yeah, Youtube videos can help you to get visitors over your site but it won't affect your page rank. Blog can help you getting traffic & link building.

The video won't really have any effect on pagerage. Although, you might have noticed that when Google spits out video results in the SERPs it usually lists YouTube videos at or near the top. The video alone will bring visitors and you can place the URL to your site in the video.

WebProNews has a good article about using video in terms of Google results:

http://www.webpronews.com/topnews/20...nd-conversions

Well, if you make a lot of widely viewed videos, that aren't necessarily on your site, but that do have a mention of your url at the end of the video, that can be a strong motivator for viewers to check out your site, if the video was meaningful to them. I know that works with me whenever I am on YouTube.