50" is fine in a room that big. A friend used to have a 70" projection screen in a small HT of about the same size, and THAT was too big (felt like you were sitting in the front row of a movie theater...not good). He replaced it with a 50" plasma after seeing mine, and it looks great. I wouldn't go bigger than 50" though.
That said, a 42 will work fine in a room of that size if you also use it for regular TV watching. A 50" will visually dominate a room that size, which is fine if you're building a HT, but isn't so good if you just want to add a TV to your existing family room.