Thanks for the positive comment Donald Duck!
In answer to Hadrien Morand......
I emailed Tim Cook three times when there was no progress after 4 months. His email address is easy to find on the internet and will probably get deleted if I post it here. The first two emails were ignored completely - no acknowledgement even! So I don't hold out too much hope of getting listened to even at CEO level! So much for listening to the creative community.
The third time someone from Executive Relations (Ireland) got in touch with me and had a very helpful, positive attitude..
Even though this issue was reported to Apple as soon as it happened (October 2019) I've been told they don't think it is a priority and there is no timetable for or prospect of a fix. So I am focussing on this workaround helpfully suggested on here of only adding the videos immediately before publishing.
I hope this workaround does work but it has several consequences. I publish tourist guides and all of my old books get this error when I load the file on my computer to update them. It's quite complicated tracking down every video I made up to 7 years ago to re-insert just before publishing so the workaround won't make it practical to update my books.
This is a great pity because the ease of updating tourist guides, student books etc should be one of the strengths of Apple Books.
I agree using Pages is no alternative as it misses several interactive features (pop over widgets for example).
I'm currently finishing a book I put on hold last October when this all started and the helpful person at ER (Ireland) is going to get someone to check it over.
I'm not holding my breath though because someone reported doing all that with Apple directly almost 7 months ago and I did the same - sending computer logs, examples etc at Apple Support's request) 5 months ago. I spent hours screen sharing, showing Support the issue live and compiling the logs they requested for Apple Engineering. Response? Zero!
It beats me how Apple has put out several updates to Catalina - even an update to Publisher - yet ignored their amazing iBooks Author which has incredible potential in education for example.
Most disappointing is that on their recent promotional webpage for Apple Books creation - where they showcase both Pages and iBooks Author - Apple states that videos can be easily dropped into books using iBooks Author - even though other parts of Apple know this hasn't been true for seven months. Totally misleading!
Anyway, the more people who email T. Cook the better! I owed encourage everyone on here to do it and to get their contacts to. The more Apple realises this puts a block / significant obstacle on its creative community the better.