You mean the icon in product description editor window. I tried it on V2.1.0 and no problem to add a YouTube video.
On ZC v1.5.8a, there is an iframe icon but when using it I got a message 'Firefox can't open this page'. The HTML code made by CKeditor is probably wrong.
Try this:
Click on source icon and insert this code where you want your video. Adjust the link for your YouTube video in the src part and size too:
Code:
<iframe src="https://www.youtube.com/embed/YouTubVideoCode" width="560" height="314" allowfullscreen="allowfullscreen"></iframe
>