Just updated the Netflix app on my iPad to see how it works (the video out). Seems to have some problems, very slow response and slow buffering with drops in quality or outright pauses and restarts in the playback -- almost unwatchable. I've never seen this behavior from Netflix before, either on my PS3 or when watching video on the iPad's display.
Maybe it's a temporary problem (ISP/wireless) or maybe this release is extra buggy. Tried a restart on my iPad and the problems persisted. Has anyone else seen similar behavior (on the video out -- I'm using Apple's component video cable to an LCD HDTV).