I got an optoma HD65 last year, it's 720p. The HD66(new model) is 3D ready. They can be found for well under $1000, are very small and quiet.
The HD20 is 1080p and sits right around $1000 new right now.
Downsides of projectors v TV's? First is light control. This is in your basement so you should be ok, but if you share the space with others who require a lot of light for their tasks you are asking for trouble.
2nd is bulb life. 3000 hours, and $300 to replace. So if your TV gets watched 10 hours a day your will be popping bulbs annually.
Finally wiring and placement. If you have an open or drop ceiling, it's not much of a challenge, and monoprice can get you long distance hdmi cables for cheap.
I used a 4x8 sheet of 1/2 inch mdf for my screen, and it sits on the wall on a 2x4 mount system I devised. (mitre cut on the table saw 45 degrees lengthwise, one half on wall, one half on the back of the screen) so my screen has an offset from the wall of two inches. Looks awesome.
4x8 dimensional products are actually 49" wide, so I trimmed the sheet from 96" to 87" to achieve the 16:9 aspect ratio, and the diagonal is exactly 100".