Netflix has updated its iPhone app to support video out, but there is a caveat. You need to have an iPhone 4 or a 4th generation iPod touch or it's no-go. Of course you'll need the component Apple AV Cable or the composite AV Cable. Both are a bit pricey at US $49.00 but they will do the job.
The updated app is universal, and there are unspecified bug fixes, so iPad and all iPhone owners that can run the app should update to this latest morsel.
I think the only thing missing from the Netflix app is management of the user queue. There are some third party solutions like
