The Epson looked fantastic while watching hours of the Olympics, although I could go into the other theater and see that the InFocus IN83 (currently in use there), is sharper. I also know from experience, that my own projector, the JVC DLA-RS1, which just a year ago, was considered by most reviewers to be the best overall home theater projector under $10,000, isn't quite as sharp as the Epson. So there!
Bottom line: There are sharper projectors, but the Epson looks great. Again, the "hard core" enthusiast seeking perfection in all areas, might have a bit of a problem with the sharpness, but millions of potential buyers will not!
I've got a car analogy for you. I own an Infiniti G35. When I bought it there was a second "sportier" version that was slightly faster. When it comes to cars (I also own a Mazda Miata, so, you can believe that I really do enjoy driving), my G35 with its 0-60 mph, in under 6 seconds, is just fine by me.
When it comes to the Epson's sharpness, it's like my G35's acceleration - sure you can do better. The question is, is it important, especially since this projector, like my Infiniti, is a strong performer to begin with!