Netflix is a movie service that sends subscribers DVDs of popular movies in the mail. You can set up a list of movies you want online, and the movies are delivered directly to your door. Any DVD movie can be copied with the right software, but in regards to copying Netflix movies, it is illegal.
One reason why people generally copy DVD files, and the reason why the technology to copy such files exists in the first place, is to make back up files of DVDs. Backing up movies can be a good way to make sure you still have access to the movie if your original gets damaged or lost.
Legality of Backups
Even though backups are allowed, this is only in the case that you actually own the DVD that you want to copy. When you rent movies from Netflix, you do not own those movies. You do not have a legitimate reason to copy them.
Terms of Service
Also, copying Netflix movies is not allowed by the agreement you enter into when you sign up for a membership. In its Terms of Service, the agreement explicitly states that you cannot make copies of its DVDs. Your membership with Netflix can actually be terminated if the company even suspects you are copying its DVD movies. This means you are violating your agreement with Netflix if you copy any Netflix movie onto a blank DVD and that you could lose your account with them.
Another reason to avoid copying Netflix movies is that it is illegal...on a federal level. The Digital Millennium Copyright Act makes the act of decrypting copyrighted DVD movies illegal. If you get caught doing this--especially if you get caught uploading (sending this movie to other people online)--you are in violation of federal copyright rules. This could include a trial, severe fines and sometimes the threat of criminal charges.
DRM stands for "Digital Rights Management" and it refers to special protections that DVDs can have on them. This makes copying these files far more difficult. In addition to the legal issues you could face, it may not even be easy to copy the movies you get from Netflix. The original copyright holders put these preventive measures on DVDs to prevent exactly that kind of copying.