Meta-fiction does not seem to require a social understanding, for the self-reference is inherent to the story (am I right about that?). Whereas postmodernism can only be understood in the context of the social climate. (If I could make an analogy to painting: any human in the world should possess the prerequisites to understand a Pollack (if they let themselves), and even though it's illusionary, most people who have seen a regular drawing before, should be able to understand the meta-tricks of MC Escher, but only a person immersed in our culture could understand the point of a enlarged Warhol soupcan (otherwise they'd be appreciating merely the original Campbell Soup-employed artist)).
In the post I had stated that metafiction was really the original movement in the contemporary arts to be called "postmodern." In fact, arguably the first substantive use of the term was by the literary critic Irving Howe in 1959 to describe a kind of postwar fiction that was, in Howe's view, clearly departing in its assumptions and methods from prewar modernism. (Howe and his fellow New York Critics always felt that this rupture was a mortal one, as most of them had first become prominent literary critics through their championing of high modernism.) Only later--in the 1970s and even 1980s--did "postmodernism" become the label for a broader cultural tendency that theorists of all kinds found convenient in their analyses of, variously, consumer capitalism, identity politics, and historical change, or for engaging in a certain kind of highly abstract "philosophical" debate. Postmodernism in literature, or in the arts more generally, in turn became merely illustrative examples that one could handily appeal to as embodiments of one's favored theory.
It is, I think, this version of postmodernism that Nick has in mind when he says that "postmodernism can only be understood in the context of the social climate." Warhol's paintings, in this view, can be called postmodern because they "say" things to us about consumerism, about the fetishizing of objects or the artistic tastes of "elites," etc. One would indeed need to be "immersed in our culture" to get all this, but it is, of course, a central tenet of postmodernism-as-cultural-analysis that everyone is inescapably immersed in it, so the problem of interpretation is not acute.
Nick also asks "if metafiction could be labeled a piece, a subset, in the overall postmodern impulse." Indeed it could be, as long as we restricted our use of the term to mean the kind of literary postmodernism Howe was talking about and that later was applied to Barth and Coover, Barthelme and Pynchon. All of these writers were in one way or another responding to the challenge laid down by the high modernists, and in most cases they were trying to experiment further with the innovative techniques associated with modernism, not to overturn or abandon them. If "postmodern" can no longer be reclaimed from the school of cultural analysis I have described, however, I would rather discard it altogether, since I don't think metafiction, or experimental fiction more broadly, has much to do with that kind of politically-motivated criticism. Although it is certainly true that such fiction potentially has much to say about such things as the slipperiness of our notions of "identity" or the way in which stories are often used to give order to a chaotic reality in ways that are often more dangerous than the underlying chaos.
I prefer to think of metafiction as indeed existing outside the immediate requirements of "social understanding." That is, reading it, like reading any worthwhile fiction, is first of all a literary experience, not an experience in social criticism or cultural recognition. While there are some things about the "postmodern" critique of culture with which I agree, one of its most baneful conseqeunces is the way in which it has swept up what was postmodern fiction into its smothering arms and blocked our view of what this fiction is really like. It has little to do with Marx, or with Boudrillard, or with Jameson, or with any other so-called postmodern theorist. It has much more to do with Joyce, or Woolf, or Beckett. Or, for that matter, Laurence Sterne and Henry Fielding.