After looking all around, finally figure it out myself and and still laughing at myself why I didn't looked at this in the first place.
Here you go,
If your Opera browser is giving an error message or warning and not playing youtube videos or any other flash based videos, and you've downloaded the flash player countless times and not any success, here's what you needed to do.
After installing flash player as the browser suggest, just go to Tools, Advanced, Plug-Ins and then scroll down to the place where Shockwave Flash is listed, make it enable. Thats all, if you are still laughing, I'm with you, TOTALLY :) and the fun part I'm a PhD CS major, and I had to run around several days and several uninstalls of Opera to figure this out :)