I recently bought (though due to MD's one a month law can't take home until July 8) a Colt Police Positive Special for $175. I think it is in .38spl though it may be .38S&W. Anyway, it looks great- the only wear to the finish is some minor holster wear near the end of the muzzle. The lockup is great.
The same dealer had a newer used S&W M10 for about $240, and a S&W 64 and 67 for close to $200 ($220-230). At a recent gun show I saw several other .38 or .357 revolvers at other dealers (and some .357s from him) in the $250-270 range that looked pretty good. At another nearby dealer he has two mechanically good, though very cosmetically worn (the grips are horrible, otherwise they are worn but not ugly), M10s for $200.
About a year and a half ago I got a Taurus 82 used for under $200 (it was a good gun for me). Shortly after I saw a bunch of decent, but cosmetically worn S&W M10s and 15s for $200-250.
New, a Taurus 82 (not a bad gun generally, and a good gun for a beginner) runs over your limit but usually well under $300 (around here they go for about $280-290).
There are good .38s and occasionally .357s to be found around $200. If you can get her to up her limit there are many nice used guns out there around $250 and if you can go to $300 there will be many nice used K-frame .357s, nearly perfect .38s, and (if you are willing to check out Taurus) even new .38s to chose from. Certainly there are plenty of good revolver options out there for someone on a budget.