I am with BMXTRIX & Mort up there though - if it is a theater to watch movie go for a front projector. But everything is depending how you want to use the room for and how much $ you want to put in it .
Look at me, 5 Years ago I bought a JVC NV-50D500-CRT 50" (4x3) for $3K cdn; for in our basement entertainement room. Projector at that time was way to expencive for us, I could not even put a little bit more for the new (at that time) 16x9 with a velocity scan.
Almost 2 year ago Infocus come up with the X1 for $1200 cdn. Now they both in our home theater\entertainement room the JVC to watch TV and the X1 for the movie. There is nothing like watch a movie on a 8 foot wide screen !
If I knew 5 years ago would I purchase $3K RPTV ? Probably not. Do I regret it ....NO ! it as the best I could afford in size for value at that time, and the JVC still give me a excellent picture with digital cable chanel, kids something still watch movie on it and on special occasion we even play with the XBox on it.
I don't know your target price, but I have few friends in that same position. One can not go over $3K the other $5K, they both have wife and kids and both have like you, nice size entertainement room in their basement; and even if one of them have a bigger wallet, I give them the same suggestion: Find a good and now cheap RPTV 43,50 or 55 inch (16x9) that you like under $2k (very easy today) and get a DLP or LCD (I prefer DLP but that's me) front projector you can get for the reminder of your target.
Exemple : Today you can get a X2 infocus\draper package for $1.6K from softmagic(
http://www.softmagic.ca) and one RPTV like JVC AV-48WP55 48" Digital Widescreen TV for $1.5K at Future shop. I don't said to buy that and there, but I just want to show you that it's possible now to have the best of both world, big screen for movie and big screen to watch survivor, 24 and play Halo 2 ! Hey what else can you ask !!!