Can I embed video in email?
You cannot truly embed video. With very few exceptions, email clients do not allow embedded video, flash, or quicktime. The only email clients that allow any sort of video embedding are Apple Mail, and Google allows embedding of YouTube videos only. Here's a chart listing which browsers support what methods. Note how few of your subscribers will actually be able to play that embedded video: http://www.campaignmonitor.com/resources/will-it-work/video/
However, you can do the next best thing.
Embed an image of the video, then make the image linking to a page that plays the video itself. That way, when someone clicks the video to watch it, instead of playing in the email, a new window opens for them to watch the video. Here's a description of the process: http://www.wikihow.com/Embed-Video-in-Email