Netflix picture quality is not that good in the first place. I use my Nexus 10, my Droid4 and my Xbox to stream Netflix to the various TVs in my house. I find that the picture quality greatly varies depending on the connection speed I have at the time. I do not believe Netflix is in HD anyway. It looks pretty good on my 32 inch TV, a bit worse on my 42, and barely tolerable on my 60.
Netflix automatically changes the quality of the video depending on the speed of the connection. A weak connection will show a low quality video. It may look ok on your phone becuase the screen is small. Netflix streaming on my Xbox to tv looks excellent when compared with my phone, but I have a fast comcast internet connection.