For that size you need to be around 6 ft to notice any difference between 720 and 1080, so save some $$ and go with a 720P set.
I have a 61" set we are 14 ft away from and should have got the 70", so at 12 ft you are fine with even larger if you want, but that 40-42" is the most popular size.
Make sure you look at both SD and HD programming on the sets you are looking at, as what you are saying is you will be watching a lot of SD right now. Some LCD or plasmas handle SD better than others. Also, if you will have a lot of light around the reflective screens of plasma are a disadvantage, where LCD will be better. If you can control the lighting, then personally I find plasma to have a better picture. Both formats are very similar in viewing angle and power consumption, but many find the colours in plasma more "punchy"
Let your eyes be the judge. I just saw some LG and Samsung LCD's that looked good, while you will probably pay more for the Sony and Sharp names it might not be justified. Sharp makes some great panels, but sometimes puts lesser quality video processors in some of their sets. My neighbour has a Sony Bravia and they have had some problems with leakage which shows smearing on the pixels.
Likewise Panasonic, Hitachi, Pioneer, Samsung and LG make some really nice looking plasma's that are well priced.
