One thing I haven't seen mentioned in the above posts is: Does the bike fit you? If not, it isn't a good deal at any price. If it is, you couldn't do much better for starting out.
I returned to riding last year on an '86 MTB. I lubed, tuned and polished it up and put on a set of Forte VersTrac/K tires from Performance Bike Shop (less than $15 each and kevlar belted for flat resistance and run at 65 psi). Put over 1,000 miles on this set up before I decided road bikes made more sense for the riding I was doing. But the old MTB gave me a lot of confidence and was a great way to start getting into cycling shape.