Comment My home theater recommendation (Score 1) 350
I took the home theater plunge about a year ago. And AVSforums is the place for all your questions. Spend many hours on their boards and it will save you problems down the line. As for projector, I picked up a used CRT projector with 8" lenses off of ebay. I paid $579 for it. The picture quality on CRT's can't be touched by DLPs and LCDs. All the serious videophile's aggree on that. THe only reason I can see for going with a DLP or LCD would be if you cannot keep your theater dark enough.
It's a very fun hobby. And with my Athlon XP2600+ powering it, I can watch hdtv material that I download off of alt.binaries.hdtv too! Even better quality than DVD's.
The picture I get from my el-cheapo home theater is as good as film in the theater. And I can get true blacks with no screen door effect, unlike the LCD and DLP projectors. I did it on the cheap and you can too with a bit of research.