I have a 37" that I sit about 9-10 feet away from. It already looks crappy, but I can live with it. I don't have that many PS2 games, but having the BC would be nice if I want to use it in the future.
I figure I can get about $175 out of the PS2 slim, three controllers, component cables, memory card, and a dozen games.
I'm also selling my PSP (it occurred to me today that I haven't touched it in about 2 months), a dozen games, a 1 gig Memory stick, and a bunch of accessories, and I can probably get the same amount or a little better for that.
So we're looking at an outlay of actual cash somewhere between 100-150, depending on what I can get for the PSP and stuff. That's not bad for a Blu Ray player, which is the main reason I want a PS3. The rest of it is just perks, but perks are nice.