He's not what he seems to be...

WARNING! Spoilers Zone!!

The Past ~ Childhood

Son of Tsuu Ten Kyou Shu, the leader of Kingoudou, Youzen should've been the 'Prince' of Kingoudou. But Tsuu Ten Kyou Shu knew that Dakki was up to something back then, and he was worried that she would make use Youzen's natural born powers. Fearing that Dakki would turn little Youzen into some disaster-bringing youkai, Tsuu Ten Kyou Shu decided to send Youzen to Konronsan, where little Youzen would be safe from Dakki. 
In exchange for Youzen, Genshi Tenson sent over one of his disciples which turned out to be the future 'Outenkun'. (I'll have to figure out his 'real' name... ^^;;) Youzen was brought up in the care of Gyokutei Shinjin, who acted both as a father and a mentor to the little boy. 
As Youzen grew up, he had to keep his true identity and his real looks a secret. To the little boy, it must've been tough. Besides, to Youzen, finding about his twisted fate, who he really is and his real father would be one of the most important things in his life. But all... had to be kept a secret. 
No one, except for a few more powerful shinjin, and of course Gyokutei Shinjin, know about this.   

Could I add that Youzen's such a sweet little boy when he was small? He was so worried that his father had deserted him because he was a bad little boy. (note that the picture was of Gyokutei and Youzen on swings!! KAWAII!!) Gyokutei Shinjin comforted little Youzen, telling him that his father just put him here in the care of the people of Konron to make sure he was safe. It was because his father loved him that he had to leave little Youzen there. Little Youzen responded cheerfully, "Alright! Then I'll have to be a good boy and grow up to be good so that papa will take be back soon! ^-^" *melts* Isn't he sweet?

The Secret ~ His Other Form

I've always found this weird though... Youzen has a Youkai form. Why? Probably this thing in his blood, him being a Youkai Sennin in fact (refer to Childhood). Anyway... seems like that Youzen has to use his powers (ki?) to keep himself from transforming into his Youkai form... so his Youkai form would happen to be what he -really- looks like. (Oh no! so he's not really the blue-haired bishounen!) Since he has to keep his past and his identity a secret, he can't let anyone find out that he's actually a Youkai. However, this was revealed near the middle-to-end of the manga series.
Youzen is a lot more powerful in his Youkai form obviously... I believe it is mainly because he doesn't have to leave some of his power to form keeping; that is, keeping the look of 'the blue-haired Youzen'. He also has this 'half Youkai form' and 'Full Youkai form'. 
(sorry if I sound kinda of weird here... ^^;; I can't really figure out the terms.)