There are two ways to do this. One requires the computer you are presenting on to have an internet connection and the other does not. Both methods are for PowerPoint 2007.
If you will be presenting on a computer with Internet, the following step by step tutorial with pictures will tell you how to easily insert YouTube videos without having to download anything:
http://iconlogic.blogs.com/weblog/2010/05/powerpoint-2007-insert-youtube-videos.html
If you will be presenting from a computer without internet, follow these steps instead:
1. Find the YouTube video you would like to insert into your PowerPoint presentation.
2. Copy the URL for the video.
3. Navigate to www.mediaconverter.org (there are other free media converters, but I've tried and had success with this one) and click Enter a link.
4. Paste in the URL for the YouTube video and click OK.
5. Click Go to the next step.
6. Select an output file type and click OK.
Choose either avi or wmv.
7. Click Start to begin the conversion.
8. When finished, click Download and save the file to your desired location.
9. In PowerPoint, select the slide on which you would like to insert the video.
10. On the Insert tab choose Movie > Movie from File.
11. Navigate to where you have saved the downloaded video and click OK.
12. When asked how you would like the movie to start in PowerPoint, click When Clicked (unless you would like the video to begin playing automatically).
13. Move and resize the inserted video as desired.
14. When you view your slide show, click the video to play it.
Click the video again to pause or stop it.
Because you only want to show a minute or two of the video, I would suggest the second method. Before inserting the avi or mov into your PowerPoint you will need to take the video into a separate editing program. Often if you have a PC your computer will have come preinstalled with some sort of simple video editing software. If not, you could download a free trial of something like Camtasia. But personally, that would be too much work for me, and I would just take note of what time in the video I wanted to start and stop playing and just drag the playbar there manually when presenting.