We lived in a house with a very large finished basement for 4 years. I learned a few things about finished basements and how they wear very differently than the main floors of the house. The basement we had sounds about the size of yours, about. 1000 square feet of finished space. It had a media room (entertainment center, large sectional couch), a large open "game room/workout room" space, a bar, a full bathroom, and a bedroom. It was a combo of carpet, laminate floors, and tile in the bathroom. While we lived there, there were 3 instances of flooding. One from a pipe leak in the main plumbing of the house, one from a sump pump failure, and one was weather related (there was a sliding patio door that lead out to a set of outdoor stairs up to the back yard. We had VERY heavy rains overnight with lots of leaf debris that blocked the drain on the patio, causing water to come in the slider onto the carpet). Two instances resulted in serious water damage to the carpet and pad underneath. The second time, the carpet needed to be ripped up and replaced. The other happened on the laminate floor and resulted in water getting underneath and bubbling up of the floor. We were glad we were just renting because the owners spent a lot of money on those cleanups and repairs.
We constantly had bugs down there as well. Lots of spiders and small worms. It always felt damp down there and was always very cold even though it was connected to the home's HVAC system. We needed to use space heaters in the winter and a dehumidifier year round or we would see mold spots forming on the soft goods like furniture and drapes.
If I ever owned a home with a basement that I wanted to finish myself, I would only install tile floors throughout (or just epoxy seal the concrete) and use area rugs and those rubber jigsaw type playmats and exercise mats for those areas, which are inexpensive. Water damage in basements is very common and tile flooring will eliminate needing to replace floors that get damaged in the future. I would never install carpet in a basement. Basements just get so damp no matter what, and that leads to mold and mildew in carpets. You can install vinyl sheet flooring for less than carpet, and it will last much longer and be much, much easier to keep clean and maintain.