I was looking for a Youtube solution and came up with a small chunk of code that works for me.
I had to disable video display in k2 category settings to make it work.
<?php
$video = $item->video;
$video = preg_replace('/\{[^}]+\}/', '', $video);
$v_thumb = '
i.ytimg.com/vi/' . $video . '/maxresdefault.jpg';
echo $v_thumb;
?>
<img src="<?php echo $v_thumb; ?>" alt="<?php echo K2HelperUtilities::cleanHtml($item->title); ?>" />
This will display the video thumbnail from youtube server.
Would've been great if you could add auto thumb generation for k2 article in the future versions.