FLO style guide for authors
However you set up the video to be viewed, there should be the ability to view it in full-screen mode for usability/accessibility reasons.
Linking to/embedding a video is not breaching copyright, but source attribution is required if embedding. (If a YouTube video, look for the contributor's name directly below the video screen.) Find out more about attribution (copyright) (Wikipedia). If referencing rather than attributing, follow your school/faculty guidelines.
FLO will automatically embed a video if you are linking to it in YouTube.
If you make a video yourself, you could put it on YouTube and link to/embed it in your FLO site.
Other web-based videos
Videos that are not YouTube or Flinders-located should be linked to their original source (eg an external webpage) to avoid copyright infringement.
Video placement and size
Videos can take up a lot of space in your topic if linked/embedded in a week/module in your FLO site, so you may want to think about options for placement and/or resizing.
You could link/embed your video in a page (Add an activity or resource > Page). This also allows you to put a context around the video. If the video is critical to the topic, make sure it has a prominent place in the topic site (eg in the first or second module).