Here is the system I would build for 3.5k:
Projector: Optoma HD33, $1.5k
screen: Wilson Art DIY 125", $250
Reciever: Onkyo TX-SR709, $550
Source: Panasonic DMP-BDT210, $120
Speakers: Infinity Primus p163 fronts, c351 center, p153 surrounds, $520
Subwoofer: Rythmik FV12, or Epik Legend
The advantages are obvious, larger screen, 1080p picture, and much better subwoofer. I think what it gives up from the recommended system is the blu-ray player doesn't have as many features, and of course, the screen would take some elbow grease. Also my setup squeezes every last penny in performance out of that 3500 and doesn't leave any room for cables, surge protectors, mounts, etc. Another caveat is these prices are shipped prices, but they do take some looking to find, ie they are not all conveniently at the audioholics store.
If I had just a little more room, like say $50 more, I would upgrade the sub to the Hsu VTF2 mk3, or Outlaw Audio LFM-1 Plus, or Elemental Designs A3-300, for even more powerful deep bass. I really wanted to squeeze one of those subs in there, but I had to play fair and keep the entire setup under $3500 shipped, and as it was I was bending the budget a bit to skip the cables. If I have to factor cables in the final price, I would step the sub down to a Elemental Designs A3-250 thereby saving $50 and getting those cables from Monoprice, the most expensive certainly being the HDMI that needs to go from the receiver to the projector.
An alternate setup for me would be to skip 3D and downgrade the projector to a Optoma HD20 or BenQ W1100 or Vivitek H1080FD. Then take that $500 saved and upgrade the fronts to Infinity Primus p363, and upgrade the sub to a Outlaw Audio LFM-1 EX or Hsu VTF3 or SVS PB12 NSD. This might be what I would lean towards because I like the bangin' music more than I like 3D, although I don't have the animosity towards 3D that many around here seem to harbor.