if you want to buy new, a Trek 7.1 or 7.2 would probably work well for you. just throw a set of fenders on that and you'll be fine in the rain. it's a hybrid, a reasonable blend of speed & comfort (i.e. geometry is relaxed enough that it won't hurt your back).

I commute on a Trek Soho, and it's basically the same as the 7.2 except that I have the fancy/expensive internal gears, brakes, and belt drive.

I think hauk is right that it'll be tricky to get an IGH for $500, at least not a 7 or 8 speed. I would never buy a bike without riding it but that's just me. Craigslist is another possibility (I got my road bike there, amazing deals to be had!)

good luck!