Lifehacker shows us how to turn your Xbox 360 into a streaming netflix player in this article

The steps were in general as so:

Step 1: Set Up Your Xbox as a Media Center Extender

Step 2: Install the vmcNetflix Plug-in (download here)

Step 3: Set Up Watch Instantly on Your PC

Step 4: Set Up vmcNetflix on Your Xbox 360

Step 5: Enjoy!