Hmm sounds like a flat bar roadie would be okay. I'm currently on the hunt for a bike for my mom's ex-gf and that's what I'm trying to find her. Kona Dew's can be had for about $400 http://www.konaworld.com/08_dew_w.htm

My thought though, would be to rock the old bike as long as you can if it works. Reason being is that a $300 bike isn't gonna get you much, and then when you go to buy another bike $700 won't get you much more. If you wait and buy one $1000 bike you'll get a LOT more.

Mom is probably right about new tubes. I pried one out of my rear tire before a big ride that kid you not was STUCK to it and we're not talking about it being in there that long. Most shops will sell you a tube and change it out for about $10 a wheel. I would however bat your eyes, tell them how you're super excited to get into biking and, this is the important part, looking to buy a new bike soon and would they show you how to fix a flat. I am so evil.

Seriously though, congrats. It is overwhelming at first but learn what you can and don't stress about the rest. There are people out there who probably enjoy their cameras as much as me, and don't know half as much! Losing weight biking just happens which is awesome! I didn't even realize I was until a coworker pointed it out and I noticed my pants were hovering over my butt crack!

And yes, charity rides do rock. You have totally realistic goals and those will help you immensely!

Peas!
-HillBill