In short, the main point put forth by the changed policy is that Google — which used to keep its user history from Google Search and YouTube separate — can now combine collected user data in order to deliver better results and show advertisements that have a greater probability of attracting your click on them and hence make the Search Giant some good money. And, while this is not as bad as it seems, (it is definitely better than Google’s re-branding the Android Market to Google Play,) the decision to start using its services, or continue to do so, is left entirely to you.
[You can read EPIC's original complaint against FTC (pdf document.) Or you can listen to Rainey Reitman's short talk on CBC's Day 6 Explainer. And if you decide to stick on to Google, you can join me on Google+!]