Chris - In all fairness, no theater has light yellow walls that you will ever visit, or windows, or white ceilings. What you have is a typical room as found in most homes. Bright and airy and terrible for front projection to deliver the best quality. Certainly this is typical of many family rooms, but many people who do front projection are in basements, or they are setting up rooms with medium shades of paint, on walls and ceiling. Not everyone for sure. At the end, the room color is the most significant impact to image quality you will ever have with front projection.
Which is why you will get nearly zero benefit from a more expensive projector. As it stands right now, spending an extra $1,000 doesn't buy you one bit more of reliability. It can buy a better image, but that better image can only be realized in a good room. This is why the Optoma HD25 and HD131 and BenQ W1070 are such popular models. They aren't phenomenal projectors, but they have shown to be reliable, bright, and cost effective.
I would look at the Optoma HD25e or the BenQ W1070 and perhaps a 133" fixed frame screen. Your wall height can't support much more, but your distance does ask for a bit more size if you can get it.