I'd really try to talk them into a revolver, then either go with a 38 snubbie, or a 4" 686 or something similar. Tons of ammo selection, easy to use and for most to shoot well, negligible recoil if using 38's, etc. If a semi auto is a must...
In my area, the Walther P99 sells for $499 if you really look, though $550 might be more common. A Sig Pro also sells for about $550 for the regular model. The Sig is nice because you have a decocker, but its also got a hammer and is DA/SA capable. I have both of these pistols and they have been absolutely reliable--not a single malfunction fo any kind.
While alot of people have been recommending CZ's, and while they are fine guns (mine always went bang and was relatively accurate) they do have largish grips and don't fit everyone's hand well. The full size is also a pretty big gun. Still, they are decent for the money.
I'd really try to get them to go revolver though if possible...