That would be even more of a novelty. The normal person doesn't even have an empty room to dedicate to a 360 degree projector setup for starters. And how would it handle things like corners of a room? And what would be the appeal to start with other than being 360 degrees? Having the cockpit of a racecar being displayed on the walls for instance hardly seems appealing when those walls might be 10 feet or more away from you.
Head mounted displays make much more sense than that. But I'm quite sure we're going to have tv's and be playing games on them for many more decades to come.