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Not quite correct. When a video is uploaded, that user agrees to YouTube's license, which gives them the right to control distribution of that instance. That doesn't preclude the author from distributing their original content as they see fit.

Who thinks there may be an out if the terms do specify distribution, as if OP plans to only use the resulting video for his personal use, that would not be a distribution, but if he gave someone a copy, even for free, then he would again be in violation of YouTube distribution prohibition, assuming that he cares...
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