Got it to work with Sony's help. They had me delete NETFLIX, THEN delete "Netflix" from within the SAVED GAME UTILITY.
Then boot to safe mode --> Turn off system. Hold down power until three beats. Light turns read. Hold down power until 4 beeps-- the last two are a double beep. Then go to restore file system... (which only removes fragmented files-- it does not erase your stuff)... then after that finishes [you need a wired ps3 controller to proceed]...
... reinstall Netflix and it works.
I actually wonder if the reinstall would have worked after deleting the SAVED GAME -> NETFLIX stuff, but we did not stop there.
Hope this helps.
