Never listen to a salesman who is trying to steer you away from a 250. They’re just trying for more commission. Unless you yourself are a HUGE guy (which you are most certainly not), a 250 will do you fine. The Honda Rebel 250 is a great bike for around town but it struggles at freeway speeds. It tops out in the neighborhood of 85-90mph which is the speed traffic flows at on the highways in South Florida where I was born. I think you should let that be what decides it for you. If you plan on hitting the highways often, yeah I would move up to something bigger, perhaps a 500. But if not, the Rebel will do you fine.
I can’t speak for elsewhere but here in Pittsburgh the sales are great right now. Dealerships are letting 2010 Ninja 650Rs and ER-6ns go for under 6k OTD. My local dealership has a 2010 Z1000 on their showroom floor that has a sticker on it for 7500 OTD.