I've never regretted spending what seemed at the time to be too much on a camera (within reason, of course).
In the 1970's I purchased a very nice Rollei 35LED. Years later I realized I'd spent almost 20 times the cost of the camera on film and development. The Rollei worked fine, but for not much more I could have purchased a better model with next to no impact on the overall cost, and probably gotten better pictures (maybe).
Nowadays film and developing aren't part of the equation. In fact about the only consideration is how long until you just can't resist buying a new camera since the new ones are so much better than the one you bought just 5 years ago.
I've decided to go for a Sony RX100 (to replace my great but slow and somewhat heavy Canon G5). The RX100 currently costs about $575 new, a lot less used, but still a lot more than you mentioned. But it got such great reviews, and probably will take much better pictures than a $200 camera, you might consider moving up.
I guess it all depends on how much you expect to use the camera and how important picture quality is to you.