Bernina just came out with a little machine that would work. I think it might be in your price range. Also, check out Overstocked.com. They have some absolutely awesome deals on refurbished machines of many different brands, come with full warranty. DH just got me a little Brother CE4000 for $89 (to use while my Bernina is embroidering) and it really is a nice little machine, has 30 stitches, some 7mm. Shipping is always $2.95.
Good luck.