Just in case you were still wondering about this....
I was having trouble, too, but I found the fix - Basically this is what the end result code should look like in step 3:
The big part that was missing was the < lj-embed id="1" > <- which the number will have to change for each song, so I suggest starting with 1 and just working up. Also, make sure you put in all the < /param > because if you copy the embeded video from youtube then that part of the code is not in there. I think those are the big issues, but if you want (because it's easier) you can just copy and paste my code from the text area, then just take the links from the embeded code you copied from youtube and paste it where my links are. That should solve the problem in the code for you. If not let me know.