“Watch Later” Video Service for iPhone
Instapaper does have some basic YouTube functionality — if you save a YouTube page to Instapaper, it will appear in the app with a thumbnail and play button, so you can play it directly there.

You might also want to check out Pocket, which is similar to Instapaper, but a bit more focused on multimedia, rather than mostly just articles. I believe it has some sort of offline viewing mode as well, but I'm not that familiar with it.