[carpeperdiem]

I've used the JW media player. As long as you surround the js with

{literal} js code hee {/literal}

you'll be fine.
use smarty to propogate the xml (per product)

to test, DON't use the flv player -- but make sure your smarty code puts the correct content where you want it (per product).

THEN test the flv player with a static flv.

THEN integrate.

Good luck.