those look to be vertical drops. So unless you want to get something like the ENO hub (or a chain tensioner like the Singulator), you might have some trouble getting your chain tight.

$45 is a good deal still (depending on how much shipping is)...The bike looks like its in good shape..

It really depends on HOW MUCH modification you plan on doing...Personally I would go with either a road bike with horizontal dropouts, or a track frame.