Fungui,
FWIW a few thoughts on your project:
1) Calculate the rooms volume (10' x 12' x ?') then contact both HSU and SVS for their advice on sub size/model necessary to fill that sized volume/room.
a) Also be ready to let them know if the room is closed off or open to other rooms.
2) With a $1500 budget, I would strongly consider starting with a 2.1 or 3.1 system and thus be able to afford better front stage (LCR) speakers. With a planned sub, bookshelves will provide better value than towers in most cases.
a) Plan to build to your target 5.1 surround system down the road, after a few more paychecks/birthdays/Xmas etc.
b) I agree with you that in a 10' x 12' room, a 5.1 system is the right surround capability needed.
c) Speakers can be a long-term purchase (if done right the first time); receivers, media/cd/dvd/br players, and displays change much more rapidly as formats and capabilities evolve. Spending up front on quality LCR speakers will save you money in the long run.
3) In a 10' x 12' room, I would lean more towards a display panel over a projection/screen system, since you probably do not need the extra screen width the projection system brings. One rule-of-thumb is to divide your seating to display distance in half and that is a good gouge on the minimum diagonal screen size needed.
a) For example, if you are sitting 8' from the display/screen an appropriate diagonal screen/display size is ~4' (or 48") (I would round this up to at least a 50-55 inch screen).
b) My point being, even if you up size to a larger 60" or 70" display; these are common and more affordable than a projector/screen combination in most cases.
c) However, if you are a serious videophile, there are other benefits to a projection system which may influence your decision in that direction.
4) In your build out of the room, I would consider wiring the room for more than you intend to install; i.e. wire for 2 sub locations (fore and aft), 7.1 surround, and even Atmos. It is much cheaper, easier, and less messy at this stage than after the fact--plus wire is relatively cheap.
Cheers,
XEagleDriver