I've been wrestling with some weight loss issues as well - 6'2 270lbs. I have an entry level mountain bike ("MTB") from raleigh that cost around $250. Money well spent as the wheels have held up to my weight and less than skillful bike handling that has resulted in rolling up/down numerous curbs and potholes. The gearing on a MTB usually has a fairly large range which means you can shift to a lower gear to help you get up any hills you encounter.

Spinning at a higher cadence in a lower gear is generally viewed as being much easier on your knees vs mashing the pedals to try and move along. Spinning also translates to a better cardio workout.

There's nothing wrong with using a MTB on the road.