I have a good rain/shell jacket for hiking, but the breathability issue isn't as big a deal on the bike, as I find I'm only getting wet up front and can have big air vents all over the back to get perspiration vented off. For hiking, however, a solid, not cheap Gore-Tex performance shell is a huge comfort and durability factor.

My $100 hiking shell lasted me two years and never breathed well, and never kept me all that dry either. I picked up a jacket on sale that was originally $300, and I'm dry from outside, and reasonably dry inside as well.