OK, just picture this. Put a white sheet, cloth, pillow case, whatever, on the wall where the screen would go. How "dark" is that? The reason I ask is because when you project an image on to that color, the blacks and grays from the image can not be any darker than that white sheet (or whatever) is. Remember, a projector can only ADD light, but it can't REMOVE light, so your blacks will be only as dark as the screen with the projector off.
That is why the screen is probably more impoartant than the projector, as dakkon already mentioned.
Now, there are 2 schools of thought here. Get a grey colored screen so that at least the black levels are not "white", and the other is to get a higher gain screen that is a little more "focused" so that some of the stray light is reflected off of the screen and not to the viewer, and the projected image really "pops" with much brighter colors/whites which you brain automatically, to some degree, fools you into thinking that the blacks are really darker than they really are.
No matter what you do, ambiant light is the biggest killer of front projection systems. So much that when I was set up in a room with a lot of ambiant light, my wife (yes, my wife!!!) told me to move it to a dedicated room so that I can control the light. And that was with me taking the ambiant light into account for the best image I could get in the price range (which was similar to what yours is now).
Good luck, but you may never be happy with the image during the day once you see it after the sun goes down. At night you will see what you have been missing during the day.
