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My PS3 is connected via a wireless internet connection, and sometimes I think it could be better, but it works well enough for online gaming. I did notice that it took a good minute or so for all the movie box images to show up while I was browsing the online selection, but it seemed to get better as I went along. It could just be that a lot of people are trying out this new system at once and Netflix’s servers are handling a lot of traffic.
I tested a couple of movies and a TV show and was pretty impressed with the results. The sound only came through in stereo, but that’s just what you get on a PC and is not a big deal. The overall image quality is good, and I would compare it to watching a non-upscaled DVD on a HDTV. There is some pixelation of small items on screen and that makes for a few jagged edges in details, but you get the same thing while watching on a PC. The TV show (The Office) said that it was in HD, but the picture quality certainly didn’t look it. I think my connection speed failed the HD test and it reverted back to standard definition.
Basically, the picture quality is just the same as it is on a PC.