I haven't heard anything about Netlander in about 2 years. Can I assume safely that it has been cancelled? I never heard that officially.

A simple google search lead to this:

http://discovery.nasa.gov/news_031403b.html

Postponed until no earlier than 2009

There's still much debate about a possible netlander.

Part of ESA's Aurora program is landing demonstrator on Mars. Now, one option is to send a 'Beagle-3'. This is what the English want.
Then, one can also send a Netlander type mission. This is basically what the French and Germans want. Let the politiking begin...

Netlander was quite far developed anyway. It will return as a mission at some point. Question is when

It's definitely dead for now -- it was the first and biggest casualty of the new French legislature's major budget cuts in government science spending.

That being said, something of the sort needs to be flown to Mars at some point, and I find it had to believe that all the development work France did on Netlander before it was cancelled will go for naught. Maybe the ESA as a whole will restart it at some point; conceivably it could even be the subject of a US-European collaboration.

Nothing is totally lost, but there's also nothing new about development work being lost. Remember the French led mini shuttle project called Hermes? or how about US DC-X/X33/X34/OSP projects ... there are more dead and canceled development projects than you can count.