We had DS's full-size crib in our room when he came home, and he slept there just fine. We also had our playard set up with its bassinet insert in our living room, and he often napped there.
Sure, he looked tiny in the big crib, but I don't think it bothered him. I think that the main benefit of a bassinet for most people is that it's easier to move around and easier to fit into their bedrooms.
I did like having DS in our room in the early months. I liked being able to respond quickly when he woke up, before he started really crying. For the first couple of months, though, I still brought him out to the living room to feed him because he'd be up for an hour or two after he ate. I watched a lot of TV on mute while he was nursing After a couple of months, he started going back to sleep right after a feeding, and I just fed him in our room (often in our bed, lying down).
I do think that we kept the crib in our room too long. (We kept thinking we were going to move and didn't want to give up our office/guest room.) DS was in our room until he was about eight months old, and none of us was getting good sleep because he was noisy and moving around a lot and would wake up when he saw us. Looking back, I think that around four months would have been a good time for us to move him to his own room. (There may be other right times for other people.)
I have to agree with LMH, babies are very very loud sleepers so you may not get very good sleep. I think 4mo is a good time b/c that's the age babies start responding to a routine. Before that, their brains and nervous systems are too immature to do so.
we moved DD to a crib in her own room at 1mo old, in retrospect - way too young, it took me many months of her crying the moment I started to lower her into the crib (over and over again, hours and hours) before she'd actually fall asleep. I'm not even bothering w/ DS -he's 12w old and still in our room.
I agree with pp's. I don't think it's so much what they're in as long as they are in the room with me - but even that is personal preference. One of my best friends had a very loud sleeper from the beginning and he moved into his own room at 1 week and did great. DS stayed with us in the bassinet part of the pack and play until about 8 weeks which worked really well for us.
Whatever they are in that is safe is fine. we had warner is this
or what we lovingly referred to as "a box on the floor" for the first couple weeks . Then we moved him into his crib in his own room around 3-4 weeks. Every baby is different, but my son has always slept great in his crib, even at that early age.