How serious are you about road biking? If you plan on doing some long rides with groups, the Varsity is not the best choice. They are well made bikes, but are very heavy. If it is just for riding around campus it will be fine. Buy it for $40, change the tires tubes and brake pads for $40 and you will have a great American made bike. But I would not take it on too many rides over 15 to 20 miles.
Looking at your Craigslist there is not much in the lower end. For a campus bike and longer rides this Schwinn CrissCross would be my choice. Much lighter,more gears and since it is newer you may not need to replace as much.
http://pullman.craigslist.org/bik/2276430780.html
Again, it depends onthe type of riding you plan to do.