In fact, it's easily the hottest thing going for affordable pricing. Epson is taking over FP by storm, at least it seems to me to often be the case.
The deterioration you're thinking of could come from use of organic panels. For instance, the older (and extremely bright) epson 6100 uses that, as did panasonic for many models. The super popular 6500 uses inorganic.
The other issue with LCD (as opposed to other techs) is the possible occurence of dust blobs since often (or is it always?) the light path is not sealed. This is a non issue with the closely related DILA or SXRD techs.
I am currently using a JVC, and it's simply phenomenal. PEOPLE HAVE NO IDEA, NOT A CLUE, about how amazing FP has become for such affordability. The only issue really is light control in the room, and even then there are ways to compromise.
DLP will often be brighter than LCD, but DLP often suffers from an extremely limited flexibility in placement, in terms of shift and zoom. Is your budget truly, utterly limited to the 1k mark? If you can swing the 2.5k price point, then you have the 6500 or pana 3000 as choices. otherwise, at the 1k mark, I would probably look at used Pana's. maybe try place like this:
http://cgi.videogon.com/cgi-bin/srch_fs.pl?WORD=panasonic&FOCUS=EXY&CTGSK=projlcda&submit=Search