If you're talking about standard definition video, something around a resolution of 640x480 or 640x360, then Blip.TV is hands down the best. Most of the other video sites use the Flash 7 encoder to change your videos from .mp4 or .mov or .avi etc. to a .flv (aka "Flash video"). I believe that the unofficial reason that they use this encoder, versus a more recent one, is because Flash on embedded devices, such as the Wii and some phones, only can run Flash 7. However, Blip.TV made the jump to the Flash 8 encoder and, as a result, has much better quality video. You can see there explanation here:

http://blip.tv/faq/#flash_quality

Now, if you're looking for a video host that has HD quality videos, then the answer is a bit more complicated. The short of it is that SmugMug, a paid photo and video service, has the highest bitrate of allowed HD uploads (3.2 mbps) in both audio and video. However, the obvious downside is that you have to *pay* to use it. It's services are quite nice though, and it's only $40/year so you might want to try it out. See their page on video here:

http://smugmug.com/photos/best-video-sharing/

Now, for the free video upload services, Facebook has the highest video bitrate (2.5 mbps), but *not* the highest audio bitrate and sampling, YouTube HD does. In general, Vimeo was one of the first to offer HD video and, as a result, is extremely popular among those who post HD video. However, YouTube has only just recently come out with this feature so we shall see who wins out in the long run. My personal opinion is that YouTube HD offers you the best bang for your buck. Vimeo won't allow you to embed HD videos unless you pay for a premium service, which is a consideration. Also, a general rule, the Vimeo community is smaller but much more interesting, active, nice, and engaging while the YouTube community is much, much larger than Vimeo's but more anonymous as well.

See the source for my explanation here:

http://techvideoblog.com/reviews/online-video-sites-hd-quality-comparison/
Source(s):
http://techvideoblog.com/reviews/online-video-sites-hd-quality-comparison/
http://smugmug.com/photos/best-video-sharing/
http://blip.tv/faq/#flash_quality

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