You can use the Video shortcode in place of your iframe. I prefer to use the Magnific Popup lightbox over the ColorBox lightbox, so I have changed that below as well. Magnific Popup looks better for videos, in my opinion.
[intense_lightbox type="magnificpopup" content_type="html" html_element="test-popup"]
test-popup
[/intense_lightbox]
<div id="test-popup" style="max-width:800px;">
[intense_video video_type="youtube" video_url="https://www.youtube.com/watch?v=Gb1HHsreEgQ"]
</div>
If you have any other questions, let us know.
Thanks!