Your budget is going to limit your choices. But thats probably OK. Get a bike, get some experience with it, and as time/budget/interest allows, move up the cycling food chain.
Giant FCR 3W
FCR 3W Bike
Youre probably looking at a hybrid. Marins Muirwoods ($429; marinbikes.com), for instance, offers a fairly fast ride in a bike thats based on a mountain-bike design but without the suspension components that add weight. It has a triple chainring that makes hills much easier, and a comfortable geometry. Its not a racer by any means, but a bike that can move along. Giants FCR 3W ($480; giant-bicycle.com) has very similar geometry and specs, with maybe a little zoomier seat position for better speed. I think Giant bikes offer excellent value. Scotts Sub 30 ($560; scottusa.com) is zoomier yet, with a nicely low handlebar position that lets you get into a wind-cheating position even though it has straight" handlebars.
Its difficult to find a true road bike (with drop handlebars and skinnier tires) for under $500. K2s Mach 2 is selling for $700 at REI, and that is one of the better buys around. It has an aero road-bike position, a light aluminum frame, and a reliable Shimano/FSA drive train. And its well worth upgrading as time goes along with better wheels, tires, and so on. You can also troll around for something used; a bike thats a year or two old will often lose 40 percent of its new value.
One problem with bicycling is that its pretty equipment-intensive. You will, of course, need a helmet (Giro Kaya, $30; giro.com), gloves (Pearl Izumi Gel Lite Tour, $20; pearlizumi.com), and glasses (Performance Vector Multi-Lens, $50; performancebike.com). Dont forget as well a pump (Topeak Peak Blaster; topeak.com), tube patch kit and levers ($8), and seat bag (Cannondale Fast Bag, $20; cannondale.com). Cycling-specific clothing is nice, as welllook for house-brand items from REI, Performance, or Bike Nashbar. It can all add up when youre just starting out.
Hope that helps, and happy riding!