Personally, I think it sounds like a great deal. You may even learn that you like a steel frame! I just picked up an old Ross with a 25 inch frame, I normally ride a 56 cm (yeah, I really don't feel like doing that conversion, something like a 22 or 23 inch?), and on a test ride the larger frame felt fine to me. Have to watch the dismounts, that's all. I believe super big frames were all the rage back in the 70s.
I haven't taken it on a ride of any distance (yeah, it needs new cables, tires and the brakes are not quite up to scratch for leaving the neighborhood). I would try riding it and see what you think! You can usually find a buyer willing to pay 100 for it, or your LBS might even offer you a trade in value on it when you do go to buy a new one. Plus you'll get a pair of clipless pedals
