For the biggest bang for you buck I recommend the Yamaha FG700S.
http://www.zzounds.com/item--YAMFG700S
My wife has one and she loves it. Terrific sound... just as good as some guitars that are twice as expensive.
The Yamaha FG700S has always rated very highly in price and quality comparisons/reviews. Do a Google search on it. Everyone raves about the quality and the sound.