Unless you're going to be using it for professional displays it won't make too much of a difference either way.
LCD usually has richer colours than DLP and the image is very slightly sharper (not that the DLP's image is blurry or fuzzy) which is better for highly detailed displays. LCD is also more efficient as it takes less power to run a lot of the time.
LCD however is prone to pixelation and are often shunned by home theatre enthusiasts as the black level and contrast are not quite so impressive. XGA projectors have better resolutions, so more pixels and thus less of a "screen door" pixelation.
Since the DLP light engine consists of a single chip rather than three LCD panels, DLP projectors tend to be more compact and also feature a contrast ration of upto 3000:1.
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If there is one single issue that people point to as a weakness in DLP, it is that the use of a spinning color wheel to modulate the image has the potential to produce a unique visible artifact on the screen that folks refer to as the "rainbow effect," which is simply colors separating out in distinct red, green, and blue. Basically, at any given instant in time, the image on the screen is either red, or green, or blue, and the technology relies upon your eyes not being able to detect the rapid changes from one to the other. Unfortunately some people can. Not only can some folks see the colors break out, but the rapid sequencing of color is thought to be the culprit in reported cases of eye strain and headaches. Since LCD projectors always deliver a constant red, green, and blue image simultaneously, viewers of LCD projectors do not report these problems.
If you've seen earlier generation DLP machines and detected no rainbow artifacts, you won't see them on the newer machines either. The majority of people can't see them at all on any of the current machines. However there is no way for you to know if you or another regular viewer in your household are among those that may be bothered either by visibly distracting rainbows, or possibly eyestrain and headaches, without sitting down and viewing a DLP projector for a while.
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Texas Instruments recently released the results of a lab test conducted last year which highlighted a failure mode in LCD technology that does not exist with DLP. Given enough time, it appears that LCD panels, primarily those in the blue channel, will degrade, causing shifts in color balance and a reduction of overall contrast. The test did not include a large enough array of test units to draw any conclusions about anticipated rates of degradation under normal operating conditions.
However it is possible that those who invest in an LCD projector may find that eventually the LCD panel and polarizer in the blue channel may need replacement. This is not much of a problem if the unit is under warranty. But if it isn't, the replacement of an LCD panel will represent an unpleasant incremental investment in your projector that you were not anticipating.
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