I think it depends on how far you sit from the TV ,and room size does not matter much since if you can't see. You can move your chair closer to the TV.
Sure, it will look weird to have a smaller TV in a huge room, but it is still okay to use as long as you sit 2-5 feet away from the TV.
I agree, some people also use their HDTV as computer monitors these days since most HDTV also has VGA, DVI, and HDMI which many computers also use to connect to monitors. You can save a few hundred dollars by just buying a 20" $200-500 HDTV and use it for both watching TV and using as a computer monitor.
I remember back in the mid 90s probably 1993-95 when color TVs were very expensive and most people had 20"-27" inch Tube TVs even for bigger rooms because bigger TVs almost cost thousands of dollars or close to a thousand dollars.