I recently paid $145 for an older (90s) Univega, with about the same features and in about the same condition as the bike pictured. In my area (NW Arkansas), this was a deal, because there are NO bikes except Wal-Mart MTBs at yard sales, and the thrift stores are worse. But since you live in Portland, I'd think there'd be a much larger chance of finding something nice at a yardsale. But I've never lived in Portland.

Assuming this is the best thing you've found in your price range, I'd say either 1) take it and understand it's a starter bike, plan on saving to get something nice if the bug bites, or 2) save your money and get a nice bike (there are nice 04 Specialized Allez tiagra or better bikes for around $595 in my area) to start.

I'm glad I got my bike, and training for a year or so on a 30lb bike will make that shiny new 20lb'er seem that much better when you do get it (or so I hope).

As far as size goes, I'm about 6'2" and have a 35.5" inseam (longish legs, shortish arms) and ride a 59cm bike very comfortably. The bike in the picture looks to be at least 60cm, maybe even 62. That may be a bit too big. But that's just a guess.

Good luck.