I had a Catalina 25, and in my opinion, 25 is the bare minimum for living
aboard. Overnights/weekends are fine, but for actually living aboard, a 27-30 gets you a much more comfortable boat, and there are
27-30's in your range that are still decent. I'm in the process of looking for a next boat, and my budget is the same as yours, and I'm finding a lot in the 27-32 range. You do need to be ready to move, but opportunities are out there.
To your specific boat, I like the S2's, but the 7.3 is a little small, IMHO, for your needs. However, I tend to like more space, and I mostly daysail with my family (wife, two young kids). I think that if you can find the S2 8.0's or 9.2's, then you'll be a lot more comfortable.
What other requirements do you have? Wheel/tiller preference? Does it need roller furling? Max length? Inboard/outboard? Age? Porta-potty or marine head? How many berths do you need/want?
Some other boats to consider:
* late 1970's and early 1980's Hunters - the 27 has a smaller cockpit, but it's a very nice boat and you can find a lot of them out there. The 30 is also a nice boat with more room all around. The 27's cockpit is too small for me, but it works.
* Catalina 27/30
* Pearson 30/32
* S2 - 8.0/9.2A or 9.2C
* O'Day 27/272/30
* Irwin 30
* Ericson 30/32
* Endeavour 32
From what I've read (again, I'm not an expert and don't have a lot of practical exerience) these boats are all decent. If you're diligent, you can find them in your range. Look for people who need
to sell. There are many reasons why people need to sell, and in many cases even though your offer is lower than they really want, they are happy to be rid of the boat.
Any way, if you're willing, post pics here (or open a PhotoBucket or other account and post them there, with a link here) and we'll give you some feedback.
You might also want to check out this article: Catalina - Capri - 25s International Association
Although you aren't looking specifically at a Catalina 25, the article has a LOT of good suggestions for conducting a self-assessment.