I'm going to go through this article start to finish to give my two cents (which may turn into a full nickel) which people can agree with or ignore.
1. Step one should always be the completely layout and preparation of the room. This means you do pick your screen location, you also figure out where the projector goes, then you get all the wiring done, power to all locations, speaker wiring run, etc. Then paint the room a dark color, including the ceiling, as possible, along with darker carpet. This all may sound 'advanced', but you have to have power to projectors, and you need external speakers. Once this is done, then it takes a couple of people a day or so to completely paint the room and nice deep blue, burgundy, or chocolate brown. The importance of painting a room can't be understated. Other things like light control also should be considered and dealt with as a stage one step. Especially if running HDMI, control, conduit, and power to the projector behind walls, why not take that time to go ahead and add a dozen recessed lights to the room? Make sure that you run wires to a location that the projector supports for your screen size (see step 3)
2. Okay, now we get to step one. Screen height should be such that your eyes are 1/3 to 1/2 way up from the bottom of the screen. Numbers like 36" are WAY off for single row seating. Sure, you can argue this and there is some personal preference, but most commercial theaters have the center row of seating almost exactly positioned for eyes to be about halfway up from the screen bottom. It's a typical mistake for people to mount the screen so it's way to tight to the ceiling as they push to put the bottom 36" from the floor. No, more typical is about 14" to 24" from the floor, and lower is certainly acceptable. Just remember where your center channel needs to go.
For screen size, a typical recommendation is to follow THX standards. Basically, the screen width should be about 2/3 the viewing distance. So, if you sit 12 feet from the screen, a 8 foot wide screen will give you a 'center of theater' feel. That's a 110" diagonal 16:9 screen. If you like sitting a bit closer than the center in most theaters, then go a bit larger with the screen, or plan to move your seats a bit closer.
If unsure of a screen size, perhaps figure out a projector (step 3) first, then try out different sizes on a white wall, or a flat sheet and then pick a screen size. Some people just end up painting a part of their wall white and being very happy with the results.
Be aware that a lower ceiling height impacts potential screen size and screen height.
Unless you have a very wide wall, it almost never makes sense to setup a 2.35 screen. You aren't buying a 2.35 projector, so you give up potential size when you work away from the 16:9 aspect ratio that projector was designed with natively. You also limit your projector options significantly.
3. Now that you know WHERE you want your screen, and you know where you generally want the projector, you get to pick out a projector. Well, all of step one, two, and three are tied together. Screen size is based on viewing distance and personal preference and room size. So, you now need to pick a projector. Ready for some homework? You really want a budget with this purchase. You can't have any expectations with a budget, you just get what is available. So, if you have $500, you can't expect a 1080p projector with great blacks and sub 30ms response times. But, there are still options. At under $1,000 there are some excellent DLP models. At $2,000ish you get into the better models including some LCoS, and LCD models which do very well. The more you spend the more placement flexibility you typically get with a projector. Features such as lens shift, and longer zoom range from the lens come into play and may be very important in your setup.
If your room demand the projector be placed less than 9' from the screen, you may need a short throw projector, which limits your options significantly. If you want it to shine 20' across a room to a 120" screen, you may likewise be limited. If you have 7' ceilings, you have different obstacles as well. Most of these obstacles can be overcome, or somewhat dealt with by having a larger budget. But, if you have a low budget, you may find that you must make compromises to your setup, or expectations in line with that budget.
We will pick two different gold standard projectors as of right now (July, 2014).
The BenQ W1070.
This projector has very little zoom range. It can throw a 120" diagonal image from between 10' and 13'1" from lens to screen. The lens (when ceiling mounted) must be between about 2" and 4" above the top of the screen, and must be on center. It's plenty bright enough to fill a larger 150" to even a 180" screen in a darker room with a good image. It uses DLP and has very fast response time and good color. The black levels aren't as good as some other models, but it delivers a quality image that's free of visible noise in the image for well under $1,000. It is a bit louder than more expensive models, but is a budget leader in projection, with no obvious 'better' models that has challenged it in almost two years.
The Sony VPL-HW40ES: $2,500(ish)
Perhaps on sale for $2,000 or less, this model is a new release with good 3D quality and very good black levels. It delivers an image that is similarly bright to the W1070, but does so with better black levels. The lens can throw a 120" diagonal from between 11'11" and 18'11" - so far more range than the W1070. It also has significant lens shift. When ceiling mounted it can be over a foot above the top of the screen to a foot under the bottom of the screen. As well, the lens could be several inches off center without it being an issue. Reports of using the extents of the lens shift introducing some lens error have been reported, so don't push the lens shift all the way. But, you have far more flexibility, especially if you have low ceilings, or a I-beam you need to project under.
All of this matters in your selection, because if you ran your power to 9' away from your planned 133" diagonal screen, you aren't going to be able to use either of these projectors. But, if you've run the wiring to 13' away from the 120" screen, then you can use either projector, or a long list of other models. So, this is part of the starting process.
4. Hang the screen.
Follow the instructions that came with it, and make sure the height you intend to hang the screen works with the projector you have purchased. While a model like the W1070 allows the center of the lens to be between 2" and 4" above the top of a 120" diagonal screen, a projector like the popular Optoma HD25-LV requires the center of the lens to be about 9" above the top of a 120" screen. That may be really tough to do with 7' ceilings, but may work great with 9' ceilings. So, be aware of this!
Offset is incorrectly stated in the link. Offset is almost always positive and is almost always measured from the bottom of the screen compared to screen height. So, with the projector mounted on a coffee table, and having 10% offset. With a screen that is 50" tall, then offset would be 5". That is, the bottom of the image would be 5" higher than the bottom of the lens. If the projector were ceiling mounted (upside down) the top of the screen would be 5" below the center of the lens. As with the aforementioned HD25-LV... the projector has about 17% offset, which puts the image 9" above the center of the lens, when the projector is upright, with a 120" screen.
On projectors with lens shift, typically the amount of lens shift is measured as a percentage of the screen height. With small offset projectors, like the BenQ W1070, it's a percentage of screen height, but is doesn't have a neutral position that is anywhere near the center of the screen, so a general 2" to 4" above the top of the screen when ceiling mounted is a guideline as the lens shift range is about 8% of the screen height (just a few inches on a 50" tall screen). With the Sony, the lens shift range is closer to 300% of screen height, with a neutral position in the center of the screen. So, once again, some homework, reading reviews, and asking questions is very important.
5. Okay, your screen is mounted. Now it's time for the projector to go up. You know the offset, or lens shift works in your room. You follow the general distance requirements as described in the link and it works. You need a good mount is always a good thing. Much like a good screen, a good mount can outlast several projectors. In my experience, the Chief RPMAU Elite Mount is the best on the market. With independent roll, tilt, and pitch controls you get incredible flexibility for the money, but at $150+ online, you are paying for it. Cheaper mounts tend to be just that... cheaper. Not as well built, and more difficult to adjust. If you buy a cheaper projector, a cheaper mount may not work with your setup.
On the other hand, if you are handy, buidling a very adjustable projector mount can be done for less than fifty bucks.
6. I think the rest of the tweaking looks pretty good in the how-to, but I will review it and add some more comments if there is something that needs to go along with it.