You're right to look for a new best practice on video on websites as hand held browsing is booming and is expected to overtake desk/laptop browsing sooner than later.
There is no clear industry best practice on this just now. Cluey users who want to see video on websites can install the Skyfire browser http://skyfire.com/
For now, I'd use FLV on a site where the vid remains in place for some time, or where a client wants to upload new vids via their CMS we suggest using simple code from Youtube or Vimeo accounts.
However, I do think that all clients with websites should have a different website for handheld devices, where for example video would be replaced with static graphics, noting that video is available on the main website.