I have to agree that you will get your most bang for your buck if you buy a used bike off of craigs list or something of the sort. When I started riding about 4 yrs. ago I couldn’t affor more than $300 so I bought a Trek with no suspension at all. Big mistake on my part, as I got about 6 months into riding it the bike fell apart and I ended up having to suck it up and buy a $600 Marin Hawk Hill. It worked great for me for awhile. I was able to upgrade many of the components and I still ride it now. In more recent times I am starting to break some of the components that have not been replaced and am getting sick of putting money into it. Therefore I am going to blow my tax return and bonus on a much better bike.
Another idea is to check around for your bike stores for 2008 models and sometimes even 2007 models, these are excellent brand new bikes that occasionally can be purchased for a fraction of the cost that they were brand new.
Anyways, good luck!