I bought one of these recently:
Over your budget, but the quality is astounding. It's also tiny, but has 25x optical zoom and great battery life.
I initially bought a £200 JVC hard disc one to replace my old miniDV camcorder. The image quality was very poor, especially on movement shots (e.g. kids running about in the garden. The battery went flat really quickly as well, so you always had to charge it when you wanted to use it.
The Panasonic is well worth the extra.