Is google collecting information about me?

Yes it does and via cookies. Google does provide a preferences page, where people can opt out and see what Google has inferred about their interests. Note that this page itself is viewable only if cookies are enabled (if the page says "Cookies are disabled", likely your browser is protecting you from cookie collection).

Flash cookie manager

Adobe Flash player, used for most Web based video viewing, tracks cookies as well as your browser. Those cookies (as any cookies) may be used to track your visits, web habits as well as login information to Web sites. What you may not know is that you can set and control which sites is allowed to collect cookies by using the "Flash Player Settings Manager"  Cookie management menu. You can change many behavior and menu settings from this Flash page (visit at least once).

How do I protect myself?

The best is to be aware of your Web browser settings on how to handle cookies. Each brower will have its own settings and a few plu-ins re-enrforce your privacy (plug-ins such as AdBlock Plus for Firefox for example will already remove lots of flash related commercial hence preventing over collection of Flash cookies). Beyond that, here are  afew tools you may find useful:

• Better Privacy plug-in for the Mozilla browser familly is a safeguard which protects from usually not deletable Local Shared Objects (LSOs) installed from several sites.
• Mac OS-X has a "Flush.App" Flash Cookie Removal tool handy for Mac-Users 
• CCleaner is a must have for privacy cleanup as well as trash left-over cleanup: this program is simple, efficient and fast. Beware that during installation, you are offered to install a toolbar (you may opt out). The tool is absolutely free.
• There are many free anti-Spyware and anti-AddWare on the net, take your pick: Ad-Aware free, Spybot Search & Destroy, SuperAntiSpyware,Windows Defender (for Windows users, it may be on by default) but most of them do not remove LSO files. Nonetheless, a good reminder that your privacy can be controlled.
  • BEWARE of false anti-spyware - Althouh not an accademic article, wikipedia has a list of fake anti-spyware programs; most of the tools have names close to a genuine product designed to fool users.
  • BEWARE of software packaged and distributing SpyWare. Examples are the far too popular WeatherBug application and DivX.