I doubt its Comcast, I am an upstate NY Time Warner Road Runner Cable ISP subscriber with roughly 20/2 mbit. I have QOS set up with highest priority to my Apple TV 3.
Ever since the last update Netflix runs poorly as described, at ALL times of day. Starts in HD, and drops to awful, blurry within seconds. So bad I cant read license plates or signs on Wilfred etc. Occasionally bumps up to decent compressed SD, and then back to the dumps.
I have reset my network settings, reset the router, reconfigured DNS, and even did a total "factory" reset. The problems persist. I even put it into DFU mode and reset it via USB via iTunes. (it wouldnt let me revert to a previous ipsw obviously, but had to try). No luck.
HOPEFULLY someone at Apple/Netflix fixes this soon.
Considering trying to exchange it at Target with receipt, I bet the one on the shelf has fw version 5 or 6.0.1 or something.
Also I would like to see that Time Warner app soon to replace the cable box, like your competitors have, between that and netflix.... getting tempted to go R0ku....