OK, to solve the GF and windows/courtyard issue just get a roll up light blocking blind. Really effective AND cost effective.
Personally, I'd brick up the fireplace (or fill it with sound deadening / panels to improve your sound). I'd smooth that wall nicely and do the projector route, it's really really imposing and oh so much cheaper then the large LCD/Plasma's! The idea of a gas heater type coffee table sounds really really smart! Run a small gas cable under the floor when you lay down some wooden flooring over the tiles, some light wood would be great there!
If you are starting from scratch why not try and build some sound dispersion/deadening panels onto the walls behind the speakers to improve your sound. Also, your centre chanel can be just below the bottom of your projector screen. Make sure that you get some trunking put into the walls so you don't have unsightly cables all over the place. You can also then use the back of the room for media centre/amps/etc as the only thing at the front will be the speakers. That way you can hide unsightly stuff that might distract from your movie and also provide easy access.
I agree with the folding french doors for the openings, that way they can fold up against the walls and not be seen at all when use. Also, the curtain or even blind route is a good option there too.
Instead of buying subs if you are going to build why not go the IB route? It sounds like the best bang for buck hey!
