32" at 720p is perfectly fine. I had a Samsung 32" in my bedroom for years, and it worked great. I upgraded it to a 46", and now I almost feel that it is too big for a bedroom and looks sort of stupid taking up that much wall space.

Once you get above 42" I recommend upping to a 1080p television as the pixels would be quite large for a 720p screen of that size, and picture quality would become a concern.