I'm a big fan of projectors, but they do have their drawbacks. If you have decent light control (heavy drapes or good blinds) and plan to do most of your watching at night, there's nothing like a wall-size TV, especially for movies.
You'll want a really bright projector - I recommend the Panasonic PT-AX200U. With 2000 lumens, it's a real light cannon. It's so flexible, you can even mount it on a shelf at the rear of the room instead of hanging it from the ceiling.
You can project right on the wall if it's flat white and fairly smooth, or you can do what I did, and tack up a 4/8 sheet of foamcore ($15) with a velvet border for a super-cheap screen.
Come on over to avsforum.com and check out the projector discussions and the DIY Screen section for more info.
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