I have to disagree about plasma only being better over 50in.
For me plasma is the better tech, it gives a more natural picture and can now be 32inch +.
This is something I would research into if I were you because there are so many around.
I spent a lot of time debating which to get and ended up getting a 6 month of pioneer Kuro 508XD, I have to say its superb in every aspect. Some people will say that you must buy a 1080p TV(Full HD), but in reality the tv's image processing is the thing to look for.
For around your budget you may be able to get a 42in Kuro 428xd or 4280xd, other wise the next best seem to be the panasonics, if you go for a PZ81 you even get a freesat HD tuner built in, so you get the free to air HD channels.
Try reading through this site, http://www.avforums.com/forums/forumdisplay.php?f=82
You will get great advice, they also have a classifieds section so you may even get a better tv with your money (albeit second hand).
One other thing to do if u buy new is try and price match John Lewis, ie find a retailer selling the tv at a cheap price (the retailer cannot be an internet only store) and get John Lewis to price match it. That way you get the tv for a good price with John Lewis'5 Year guarentee.
Phew....longest post Ive ever made!
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