The Sharp PG-M20X is without doubt better than the MT 5 and probably cheaper... I got mine before it was available in the UK and therefore got a one off price, but I have seen it advertised at about the 2300 mark.... A significant advantage over the Toshiba (and in fact all other 'home cinema' projectors) is that because it is actually marketed as a business rahter than home machine, you can get companies to match lowest prices etc more easily...
This machine produces no rainbows at all that I can dedect, and yes, I have seen them on other machines..... IMO there really is nothing to touch it under £5K
Neil its best to read some reviews from various sites. www.projectorcentral.com has some nice reviews along with some other sites out there.
There are quite a few new projectors on the horizon soon too, but like with everything if you wait for them, in a few months time there will be even better projectors coming out!.
Also buying a projector is about what the projector itself has to offer. There are some really good projectors out there which cannot handle HTPC's, and likewise there are some projectors which are only really good for HTPC use because their internal scalers are not very nice when hooked up to a svideo/component input.
After reading all the reviews I suggest you view them yourself though because people on the internet have incredibly diverse opinions on what image quality is good.
how quiet do you want the projector?, imho I would go for a projector <32db or 30db in noise, this is pretty quiet. 36db is quite loud and will mean that in quiet scenes in the movie it will be noticable.
DLP vs LCD - DLP has better blacks in most circumstances, but some people suffer from the rainbow effect - unless you see a DLP unit yourself and your friends then you will know which technology is best for you. LCD is known for screendoor and bad blacks, although this can be helped using a grey screen and by having the zoom lense set to minimum.
widescreen panel vs 4:3 panel - what sort of content do you plan to watch?, if you buy a 4:3 panel then you will have to invest in some velvet to blackout the top/bottom of the screen which is what I do. This works very well, but some people prefer the widescreen panels which is how the new projectors coming out are leaning towards...
HTPC or standalone progressive DVD player?
some people hate PC's , some people prefer the quality that HTPC provides
On most projectors you have a zoom lens, I have found that this makes a substantial difference on my projector regarding screendoor (not black level!). I suppose it makes sense really when you your using the zoom on the lens of your projector you are increasing the space between the pixels being projected on to your large screen - and creating more screendoor. The less zoom on your projector lens=smaller gap between the pixels displayed on your projected screen.
As a test I showed a friend who saw my projector a few months ago, before he could see screendoor from about 4 to 5 feet from the screen on my XGA native projector. My zoom setting on the projector used to be about half way. When my friend recently saw the projector again I had the projector a lot further back from the screen and the zoom on the lense is set to 0 (minimum) and he couldnt see screendoor from 2 feet which is incredible for LCD imho.
Also he said the black level was improved, although I have calibrated the projector which makes outdoor/indoor scenes all look damn good, but maybe having the projector set so far back makes the blacks a bit better, I dunno but after all this tweaking Im very one happy home cinema enthusiast .
However improving black level on a LCD projector really requires a grey screen, and imho a grey screen does reduce screendoor compared to a matt white screen. I doubt anyone will argue with me by saying that a matt white screen is completely inferior to a MDF screen painted with ICESTORM 6 matt finish in combination with an LCD projector. Im now a fan of ICESTORM6 matt paint as I found ICESTORM 5 too harsh on whites, ICESTORM6 is perfect for pure whites but better blacks, much like the cinema at your local UCI.