Think of it this way: the heavier the bike, the harder you have to work, hence the better your workout.

With such a bike, I would be willing only to put enough money into it to make it rideable. Yes, old Suntour stuff is good quality. The stuff rarely breaks, even if it might be heavy and out of date. Like others have said, shedding those 3-5 pounds will be hard, even if you blow the whole wad. And, you'll run into compatibility issues that will end up running the budget even higher.

For $400, I would think that you should be able to find something used that is much more up-to-date (and lighter). Look around. Inform yourself, so that you can make a wise purchase.

Cheers,
Jamie