Here's a good graph on HDTV viewing distance and how 720p compares to 1080p for a given viewing distance.

If you check a website like slickdeals.net or fatwallet.com you can usually find a bargain price on a HDTV that suits your needs. If you stick with a "name" brand, you'll most likely get a good product. This is also dependent on how much of a difference you can see in Video. Your best bet is to go to a quality brick and mortar home entertainment shop and actually VIEW all of the sets. Bring source material that you are familiar with so you can get a good comparison. I'd also highly recommend checking out avforums.com for a LOT of great advise (And they sometimes have great posts on TV Deals), and make sure you calibrate whatever set you end up buying for optimal viewing pleasure!