In my opinion:
should use desktop or server version of ubuntu for squid?
Server version - more stable, less consume of processor power.
does squid really help for decrease traffic direct go thru WAN?
Yes, with transparrent proxy (port 80 forwarded transparently to squid port and IP). You can do it also using wpad.dat/wpad.pac file with http server and dns domain - more, more info google.com.
does squid need update always?
No, not always - you have many things to configure - your choice.
i hear someone said, if youtube change script, then proxy server also need to change script to cache youtube, it is true?
I don't hear this same, so i have never test it.