I would try and get some other opinions on the screen but my inclination for your situation would be probably grey due to smaller size and it should help your black levels. that being said i have white but I like a bright image.
switcher is the way to go in my opinion. something like 4x2 that way you can add sources down the road ie computer,game console,cable box,bluray etc. plus the 3800 has been known to be flaky with hdmi sync issues. powered is a plus.
Then yes if you are ok with smaller screen. I love my 3800 and use the powered switcher from monoprice. if you get a flush mount like chief rpau and tilt the projector slightly you may be able to go bigger, thats what i did.