As I understand it, Youtube allows copyrighted music now with only a warning issued to you in an email. In your youtube admin area you will see a "Matched third party content" link next to any video that has copyrighted music in it. When you click on that link, it states the following:
"What should I do? No action is required on your part. Your video is still available worldwide. In some cases ads may appear next to your video."
The only limitation with this warning is that you can't monetize (run your own google adsense ads) on the video. Youtube displays where people can buy the music soundtrack and has it's own adsense ads on your video when people watch the video. This way, Youtube and the owner of the music make money.
Here's an example of a video I just uploaded. Any ads that are displayed aren't mine.
Steep Turns in a Cessna 172 using the Drift HD170