I had 2.3.5 on my Nexus S 4G and the phone was rooted, I accidentally accepted 2.3.7 about a week ago, when the first wave rolled out updates. It killed root, so I found 2.3.4 and reinstalled that, cleaned root and everything. Then the phone automatically downloaded 2.3.5 within 5 minutes of the phone being turned on. I updated to that and kept checking for 2.3.7, but it didnt come back... So... this is what I did and it worked for me....
I went and pulled the battery, pressed the power button for a minute to drain all residual power, replaced everything and powered on the phone. Went into Settings, About Phone, Sprint System Updates and updated my PRL and Data Profile. Then I waited a few minutes and went back into Settings, About Phone and System Updates - It still wasnt there, so I again turned off the phone (did not take out battery) waited a few minutes turned it on, and checked, and sure enough 2.3.7 was downloading and ready to install. Then installed it tested it, everything worked, then went about doing the One Click Root (which also worked on 2.3.7 flawlessly). So there you have it.
Definitely try updating your data profile, cause it lets Sprint know data needs provisioning, which triggers a ton of other updates for the phone.