I talked to a Netflix Tech Support guy a few months ago and he said their top HD stream runs at ~5.5Mbps. Depending on the device you are watching on, the buffer will either need a few moments to re-cache or it will kick you down to their 1.0Mbps HD stream to avoid more re-buffering. I have a 6Mbps Comcast connection but, like you said, I do not get a constant 6Mbps so usually if I'm watching a 5.5Mbps HD Netflix stream it will re-buffer down to the 1.0Mbps stream since I watch on my Xbox 360.
One thing you can do is pause your movie right away and allow the buffer to completely fill up. The tech said the buffer can be a max of 10 minutes because that is the copyright agreement they had to make with the studios/networks providing the online content.
I have broadband at home (nominally 5 MB but tests usually show ~3.5 MB). Either way it's a fairly fast connection so I would expect I should be able to stream content fairly well. My stereo has a Samsung Blu-Ray player that supports Netflix streaming. I'm new to Netflix so I don't know quite what to expect regarding streaming quality.
So far the results have been spotty. When I begin a stream the system shows a series of bars that are supposed to display streaming quality. I think there are a total of 13-15 bars, and if all of them light up the stream is labeled 'HD'. When I actually DO get all the bars the picture quality is quite good. Most of the time I get about 6-7 bars. Somewhere around 5-6 bars the picture quality gets pretty bad, especially in shadowy images that are changing rapidly. The buffer they use is apparently not large enough to maintain smooth display so if I watch a '1 hour' TV show there will usually be several pauses to re-load the buffer. The pauses frequently come at the same point that broadcast TV would have a commercial so we joke about how they represent Netflix's alternative to commercials.
There are other problems. Netflix does NOT offer captioning or subtitles on English language streaming content and I have found some sound/video sync problems.
IOW, I like the idea but the implementation is a bit underwhelming. Is my experience typical for Netflix streaming?