curtdr
Yes the "underused dedicated home theater" has been a theme that has often cropped up in the dedicated home theater forums (e.g. AVSForum). One really should go in with a realistic idea of how many people will likely use the theater and how often.
In my case though I created a projection based home theater system, I didn't want a dedicated room that felt separated from the rest of the house. I merged it my two channel listening room, which is the front living room of the house on the main floor. It's a high performance room in which dark curtains can be pulled all around the room to cut screen reflections for a very dynamic, big image and immersion. But it is bright and cheery by day, eminently accessible and comfy, and so my family is often in there and I used it every day, whether for reading, listening to music, watching movies or TV etc. I didn't go with awkward looking home theater chairs in such a room, but had a huge sectional sofa custom-built, which has come in handy as I've had many guests watch sports and movies with me there.
Once you have a room that feels like you are going off in to some other dark pit to watch movies, it can actually feel to some people more of a barrier.