For my wife who is of medium height and build.
Budget $500-$700
Conditions: Urban trails and City Roads (our neck of the woods is not entirely flat)
Special needs: Easy on the knees and back

Considering Trek or Fuji or other reputable brands. Would appreciate pros and cons with either brand. Open to other reputable brands as well.

My fiance has a Specialized Expedition (very upright) and A Trek Neko 2 (a bit more aggressive). She likes them both for different reasons but likes the Neko more. She says she likes the Expedition for long rides on paved trails and the Neko for everything else. She also says she feels the Neko is more fun to ride.

Sorry, that's about the best of a pros and cons I can get from her.

You can check out the Trek Verve for your wife.

If you're open to other brands, you can also check out the bikes from Electra (owned by Trek). They are more of a cruiser type of bike, but my wife saw their models and really liked their bikes. You can also look into the Specialized Crossroads bikes and the Felt Verza Path/Cruz bikes. There is also the Liv brand of bikes (owned by Giant), which are specifically made for women. Check out the Liv Flourish bike, which comes in below $500 but seems to have good enough components.

For someone sensitive to knee/joint issues, I highly suggest a step-through frame. You also likely want an upright riding style. Check on bikes like the aforementioned Trek Verve, the Liv Flourish/Sedona, and the Specialized Alibi/Crossroads/Roll. My wife rides an older Trek step-through (a 7100 WSD) and I must say that I enjoy it also...being able to step right through the bike.

For my wife who is of medium height and build.
Budget $500-$700
Conditions: Urban trails and City Roads (our neck of the woods is not entirely flat)
Special needs: Easy on the knees and back

Considering Trek or Fuji or other reputable brands. Would appreciate pros and cons with either brand. Open to other reputable brands as well.

Thanks for all the great suggestions. I will have her try out the models listed so that she can see how they feel.

Threads merged

This is a little higher than your price range but its a home-run of a bike.https://www.prioritybicycles.com/products/glide

My wife loves her Giant Cypress, as do I: I've put a couple hundred miles on it lately while waiting for my ordered bike to arrive. It's comfortable, capable, and can handle many different surfaces.

I would also recommend the Verve. I was all set on buying one but decided I wanted something a little more aggressive and went with the Neko. The Verve has a nice upright position. If you want a true comfort bike with larger tires, I know Giant had a couple nice models but I rode a Schwinn comfort bike for couple of years and hated trying to get it up the moderate incline on the trail I ride most often. My hybrid Schwinn with 700cc tires was so much better.

My wife have 2014 Fuji Absolute 3.0 LE. She like it, seem to fit her needs. Knees pain back pain is depends on the fittings.

I ended up getting the Trek Verve 2 after my wife tried out a few models (including the Electra). She took it out a few times and is quite happy with it. Even my eleven year old daughter likes it.

Thanks to all for helping out.