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Check the chart below:
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Summary: For a 32" 1080p screen you need to sit about:
4 feet away to get the full effect of 1080p
6 feet away to get the full effect of 720p
9 feet away to get the full effect of 480p
So at 2.5m = around 8 feet you wouldn't even see 720p movies at their best. 480p movies would look almost the same as well.
I compared Wolverine DVD and Blu Ray rip 720p and the rip knocks socks off the DVD, tried Wall-E and didn't notice too much of difference except in some scenes in space the 720p blu ray rip is awesome.
I have a Sinotec 32 lcd
Sony 5.1 HTDDW800 870W hdmi and can play uncompressed audio, hooked up to an HTPC with xbmc on it (Windows 7, 4gb ram, 1,5tb seagate, HD 4870 single cable to Sony amp.
In total this system cost me R10 000 - LCD, Sony amp, HTPC
Watched Star trek 720p last night - sound is exceptional and video is clear as a bell.
Still waiting for internet uncapped at home and then will download an 1080p movie.