That is very true. There's only so close you can get to the samller screens, of course, but the size of the big screen you get should be based on the size of the room it will be in. For example, the afore-mentioned 65" Toshiba looked as large as a movie theater screen from about 11 feet away, but when we re-arranged the room (new couch) to be 16 feet away, it now looks like just a huge TV (which, of course, it is).
Pairing it with a 6.1 surround system is, of course, the icing on the cake. (The TV is Mrs. kevkrom's toy... the stereo system is mine...)
According to the THX theater standard, the proper seating distance would 1.6 times the screen diagonal. Thus if you want a 10 foot diagonal screen, you should be able to sit 16 feet away from it.