I'ts a no brainer for movies.
Watching an eleven foot wide picture that's eight feet tall from 18 feet away in DTS was otherworldly. The only other time I've ever been so immersed in a picture was at an IMAX theater. I never thought anything could be better than going to a movie theater. Now I'm a changed man. Home theatrer is where it's at if you have the room for it. Obviously you don't have to spend a fortune either.
It will be too much of a hassle to watch tv on the projector. Because it is in a multi-use room, no one else can do anything else in the room because the whole room is pitch black.