Nice projector!
Since most of my home theater was fried by lightning, I decided to upgrade the entire system. I got a 85-inch Sony 4K television, Denon receiver and replaced the Bose Acoustimass cube speakers I've had for 23 year with MartinLogan. I replaced the damaged Xbox 360 and Blu-ray player with a used Xbox One X since it can do both. My family room isn't large enough for a 7.1 system so I went with 5.1. We watch a lot of television and movies and because I have no idea when I will return to a theater so I felt justified in splurging. I know by home theater enthusiasts standards our system is modest but we're loving it.

I first got interested in a projector and home theater room around 20 years ago, but projectors back then were infant technology and produced images reminiscent of the very first Walmart digital cameras that produced wallet sized prints with visible pixels. About 12 years ago I was walking through a little mom and pop optics store that was projecting a cartoon on a 3 X 5 screen in a darkened room. There were still pixels, but eight years ago, I was visiting my sister in Chicago, and went to some large tech store. I think it's name was ABT, and they had a 25 X 40 foot projection theater with stadium seating and a screen that was maybe 20 feet wide where they were projecting Pirates of the Caribbean. They had a price tag on the door for the theater, seating and all, for $20,000. Out of my price range, of course, but the point was made. Projection was now a viable mode for presenting movies. I'm on my third projector now, and my last one cost half as much as the first. Bulbs are the big expense.
But now the size of TVs are getting there too, and I can imagine projectors becoming obsolete. An 11 X 6 foot screen like mine is still a ways off, with the biggest problem being how do you get the thing into the room? At times I wonder if maybe I should just be done with projection and satisfy myself with an 85 inch flat screen like yours, but I think I can still justify waiting for the 120 inch screen. I'll probably die first. An led screen is brighter than a projection system, so there's that.
My room is actually a converted bedroom that measures 14 feet by 12 feet. 5 people is a crowd, and as you pointed out, a 7.1 sound system doesn't make sense. The room is not big enough for the right sound separation. The middle/side speakers add zero to the experience, and I took them out. With 5.1 the separation is clear enough that I have been tricked by knocks on the door, thinking someone was in the room behind me. One time, a dog was barking behind me, and I wondered why they added a dog bark to the scene. When I turned around my neighbor was standing behind me with her dog. I had the volume up too high to hear the door bell, so she let herself in.
Your system looks very nice. We live in remarkable times.