Both BLU-RAY and HD-DVD can be played on a PC with a good enough graphics card (roughly $150 now). A ~$150 sound card will also rival the best dedicated players out there too. That set up will outclass even the best (multi-thousand dollar) players for regular DVD play back too.

If you don't care too much about the WAF (wife acceptance factor) the $150 HD-DVD from the xbox 360 can be plugged into any PC and used to play (and even rip) any current HD-DVD discs. There is a blu-ray drive in the $300 range that works just as well for BD discs on a PC too.

If you have the room, I also suggest going with a projector. if you have not looked into it, you will be amazed at the picture quality you can get for under $2000 nowadays. My primary 'tv' is a projector on a 96" wide (wide, not diagonal) screen. I have to pull the blinds in the middle of the day, but other wise it works great. Once you've gone big screen it's painful to go back to one of those teeny-tiny <50" screens.

One great thing about a projector setup is that it takes up less space than an LCD or plasma because it is just little 10lbs box at one end of the room and a retractable screen at the other end. When I roll the screen up, no one even knows there is a "tv" in the room.