Illumiroom will be expanding the TV, not acting as the tv. YOu will still be using a tv as your center focus so you can't really compare it to a projector. Projectors are a bit lower quality for the most part than TVs though.
I think illumiroom looks really cool but it's nothing that I will buy as a standalone device. To me it is interesting and I think the technology is cool but beyond that I can live with my TV without illumiroom.