This is the link for retrieving list of videos related to a keyword:
https://gdata.youtube.com/feeds/api/videos?q=SEARCH_TERM
We can successfully get an xml response even when we do not provide an API key. As such google says you to provide the developer key like this:
https://gdata.youtube.com/feeds/api/videos?q=SEARCH_TERM&key=DEVELOPER_KEY
So what should I infer from this behavior? Is the list video method free of any Quota (ie Can I make unlimited calls from any IP at any rate?).
It is limited per IP basis, which is less than API quota. Best practice is to use developer key to have better quota limits.