Netflix just became a lot easier to use on the PS3. No, you still need a disc (for now), but the application has been stealthily upgraded with the ability to search for and watch videos from the entire Instant library. For example, typing the letter "A" quickly revealed Avatar: The Last Airbender.
Unfortunately, the Xbox Live and Wii versions of Netflix don't appear to have been updated with this feature yet. Xbox owners will have to wait until November.
[Thanks, Rusty Jack!]