Just get the Netflix App! It's a free app, connects straight to your Netflix account, and lets you stream anything from them you want. No need to purchase or rent content from Apple.
A note on the iTunes store for the NetFlix app says that "A device that streams from NetFlix (manufactured and sold separately) and broadband internet connection are required to watch instantly." In other words, the app does not turn the Touch into a NetFlix ready device. It only allows you to manage your NetFlix queue. The iPhone, iPad, or iTouch can then accept an input from the streaming device.
One of many links describing streamed movies on the iPad/touch: DVD Anywhere: Netflix Arrives on iPhone, and Doesn’t Disappoint | Epicenter | Wired.com
daniel; pay the extra money (cheap either way) and get the good Roku. my DVD player upscans to 1080i (max res on my TV) and there is a difference in pictures. now, i am using the Original Roku which ONLY has component/composite Video jacks so that might be my problem. also, keep in mind, you cant make gourmet tasting meals with gourmet ingredients if you dont know how to cook. most of what i stream does not come in high rez. but then again a lot of it is old TV shows that i either have not seen in decades or never had the chance to watch. one thing that cannot be discounted is the much much much increased "watchability" of TV when its commercial free. i have newly discovered several shows that i did not enjoy with commercial interuptions that are now very enjoyable. i just finished the last season of Lost. watched it over 5 nights. this is the same series i attempted to watch when it was on ABC and gave up on it after 3 weeks. too hard to keep up with the plot. the ability to watch 3-4 shows a night (same length as a regular movie) is worth 10 times what i pay in subscription fees. as far as watching it 6 months after the fact?....as i said, some of what i watched was 10 years after the fact.
Okay, I just checked with NetFlix and they say that indeed I do not need a box, contrary to the statement on the iTunes store. So I am going to give it a try. Dave: As for buying the Roku, I just don't expect to watch enough streaming media to make it worth my while. Mostly I just watch DVDs, and more than that, I read books on my Kindle. Thanks all. I'll report back on my experience.
The NetFlix app works! I can stream media to the iTouch. I cannot actually watch anything on that small screen, but I'll buy the cable to connect it to the projector and/or the downstairs treadmill TV. Cool! Thanks to everyone who offered advice! (And apparently the disclaimer in the iTunes store regarding the NetFlix app was wrong.)