CEX is ok, but they're a technology shop, they seem to specialise mostly in games consoles.
Try this site, it's a proper camera shop, they fully test everything properly. It's also where I've bought both my DSLRs and lens.
http://www.lcegroup.co.uk/My first Sony DSLR was £150 with kit lens, so there's nothing wrong with only spending that much.
The only issue with the 350D is it's only an 8Mpixel sensor, which will be fine for most stuff, but if you want to print big, you'll want more pixels. Also the 350D is getting quite old, so the mechanical parts (shutter and mirror) will be quite worn, but you can get them serviced.