We've had a minimalist home theater in our unfinished basement for a couple of years. A $500 projector does a great job of splashing a DVD movie onto a painted cement wall. When the lights are off, we forget the bare room and settle in for a theater-like experience.
In an interview this weekend with WTOP, I described how today's inexpensive projectors make it possible to have a poor man's home theater in just about any dark room.
For sound from our movies, we're using an old stereo that was otherwise gathering dust. A good sound system will be the next investment.