I sit about 12ft from my Pany 42" PZ85 and I find it the perfect size. SD looks good from a normal SKY box, upscaled dvd's look amazing and Blu-Ray's or PS3 games look stunning. It has the full on cinema effect without being OTT,for my eye's anyway.
If you can have a look at a few different sizes in a store from your viewing distance and see what you like.And make sure to view SD content and if you can fast action like football to see what the motion handiling is like.
This year's Panasonic's and Sony's have a lot of happy owners on these forums. If you want full HD then any Pany starting with PZ is a full HD model. PZ80 is bottom of the range, PZ85 has improved audio and afew extra features, PZ81 has a freesat tuner and some of the features of the top of the range PZ800. The best Sony model at the moment is the W4500 range. There is a deal at the moment where you can buy a 40" Sony W4500 and you get a free Sony Blu-Ray player thrown in.