re: 25Mbps vs 4 Mbps

It's all about if the bandwidth is there to use.

I'm sure every youtube caching server has a connection which exceeds

How does a faster connection help? It allows the video to fill the buffer
faster. Allowing for smoother playback on less bandwidth consistent
circuits. Do you need it really if your video source is under 4Mb/s? In a
perfect scenario, No.

Now, That's youtube. Using Netflix as an example.

I can start streaming a movie. And it'll pull 50-60Mb/s for about 20
seconds, And it's playing HD quality almost immediately. Where on a slower
connection it may not switch to HD until its filled its buffer more.

Nick Olsen
Network Operations (855) FLSPEED x106

Don't forget that in some cases, there are ISP-local cache boxes...
i.e. the "Youtube Servers" to which you refer may live _at_ the ISP.