You work with what is available. The setup I showed in post #1 is actually a curtained off alcove in a finished basement. Over the last few years I have worked to improve it by adding things like an equipment rack and a bar behind the recliners (work in progress). It slowly gets better, and most folks didn't create theirs overnight.
Even when it is multi-purpose, you can do many things to make it a proper space. I like my front projector, but if it isn't in the plans, you can still do a lot with a flat panel. TVs have come a long way in the last few years and stuffing the largest 4k panel that fits, along with finding less conspicuous speakers for 7.1 will do wonders.