Kev
Usually those kind of Lumen figures are not 'theatre mode' they are data mode, where they go for bright picture but low contrast. Most modern theatre projecters advertise 2000 lumens or more but actually do about 1000 lumens in thetre mode which gives you the blackest blacks.
I've been running an old Infocus X1 SVGA DLP in 16: 9 mode for 6 years now. It probably does about 600 lumens in theatre mode, which is no problem as long as you darken the room. I use the 1080i input for high definition TV and my DVDs automatically get upscaled to that becasue I use an old PC as my media centre. I have it mounted in the ceiling and a $200 motorised screen from EBay. One of the best bits of technology I ever bought at still going strong with 3000 hours on the lamp.
I would recommend future proofing by getting nothing less than a 1280 X 720 resolution HD projector if your main interest is home theatre. You can get them now as cheap as $1500.
ie.
http://www.justprojectors.com.au/hc1100.htm
Hope this is of help.
Mark