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This is one area of DIY that is very difficult as optics and placement of the LCD panels are crucial and can not be achieved with out some very specialized equipment. Is it impossible? no, but not realistic if you want a sharp, bright image.
Most of these so called DIY projects are a waist of money and results are usually far from what they say they do.
 

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Quality optics are available. From the Fresnel lenses to the proper projection lenses that are the right focal length, the end result can be outstanding. There is an amount of final tweaking after the unit is put together, usually a final adjustment of the optics is all that's involved. With a bulb life of 20,000 hours and new high resolution panels that are affordable, it may be worth checking out. The projector output is in the 250 to 400 lumen range, so a light controlled environment is a must. Here are some results from a DIY projector.

http://www.lumenlab.com/forums/index.php?showtopic=10363
 
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