I've been waiting for an open source project to come out for this. as you said, the total equipment outlay would be under $200, about 3 times that if you go the projector route but still reasonable. For the development portion you could even skip the LaserLyte barrel plug and go with a dime store The software's the hard part, and from my (admittedly limited) knowledge it's not that much of a challenge. It'd be a trivial matter to map the blip on the screen with a mouse click, and then you can train on everything from custom tactical scenario software to the latest version of Crysis.
The only thing I know of that fills the purpose and is open source software is
This by waterloo labs. They've published the parts, specs and software, but requires 6k worth of hardware and 1k worth of software to use it. More fun, hopefully will pop up at a few ranges, but out of reach of most for fun shooters.