As for IPS and response time, if you get an IPS LED like the LG that I've got you get the best of both worlds. I don't think there are many manufacturers out there that do IPS LED other than LG.
I know it's good because not only do I fly sims I play TF2, DOD or Quake Live and I can be found at the top of the leader board on most servers I play on. I'm 34 and I'm kicking these 14 year olds at their game.
so there is no display lag or ghosting.
As for immersion on larger monitors I'm not having any of it. When you are focused in the game you can't honestly tell me you are aware the monitor is bigger? You develop a tunnel vision. When I watch a movie at a Friend's with a huge TV and I come home and watch a movie at home I can't tell the difference whilst I'm watching. It's like reading a book you don't notice the book when you get engrossed. The only difference is that at the friend's house you have to sit further away. Big TV's are for bigger rooms not for wow factor.