I got it...
The code you should replace should look like this....
<object type="application/x-shockwave-flash" height="470" width="435" data="http://www.domain.com/player/player.swf">
<param name="movie" value="http://www.domain.com/player/player.swf" />
<param name="flashvars" value="&file=http://www.domain.com/flvideo/{$vinfo[0].VID}.flv&height=350&image=http://www.domain.com/thumb/{$vinfo[0].VID}.jpg&width=425&location=http://www.domain.com/player/player.swf&logo=http://www.domain.com/templates/images/watermark.gif&link=http://www.domain.com&linktarget=_blank" />
</object>
This has been tested on myspace and works fine.
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