I live in the Bay Area too, and also have Netflix. They have several distribution centers around the country (I believe the newspaper article I read about them said they have 12 distribution centers around the country, but don't quote me on that - it has been awhile since I read the article). The nearest center to one's location is the one that usually sends you your movies. In our case, they have a distribution center in San Jose', CA. This is why we receive our movies from them in just one day.
We just recently signed back up for Netflix also because we purchased a blu-ray player that hooks up to our network and streams these videos directly to the HD Television. They do have a pretty good selection and $8.99 a month is cheaper than adding premium channels to the cable.
They also have a distribution center in Orange County, so that makes two for California.
I live up in the Sierra mountains near Fresno and we used to get our Netflix movies from San Jose. Sometime in the last couple of years our movies started coming from Bakersfield. So California must have a few distribution centers now.
It is a quick turnaround for us too. Send movies back on Monday and get the next in the queue on Wednesday.
I have never used their service. Not that I am for or against it, I just don’t watch that many new movies. I am more likely to catch an old movie on the big screen at the Stanford Theatre in Palo Alto.