I agree with the above posters.. A 65" LED will cost you a pretty penny, though the quality will likely be outstanding. You're trading a slight image quality advantage for a much more immersive experience in my opinion.
With a room of 20x20, assuming you have light control, it'd be a no brainer for me.. I'd go PJ every time, especially with that budget. You'd get a good PJ, decent sound system, some shades/blackout curtains and a decent screen and probably be around the same price of the TV (just a guess.. not certain what your budget is).