In this paper we propose real-time methods for flexible processing of MPEG-2 video in resource constrained systems. The video stream is adapted to resource fluctuations by using a quality-aware frame skipping approach which keeps the video frames that have the most impact on the overall video quality. Real-time admission control and resource reservation mechanisms ensure that video processing applications adapt Quality-of-Service at run-time according to current state of the system, while fully utilizing the available resources.