Kawasaki Super Sherpa. They sell for used at about that exact price, and they are more powerful than you might expect, since it only weighs about 250lbs. Big bore kits are available to bring it up to a 350.
I have a friend who has an XR 650, he has two sets of wheels for it, one with 17'' diameter and street tires and the original set with knobbies, the swap only takes a little bit of time with practice, and he has a very versatile set up that way, and man, he can fly on the street and the dirt! Good luck. By the way he is about your size.
Our latest review of the DR is pending. In any case, I think the DR, A Honda XR, or a DRZ-400 would be fine. However, I don't know what you mean by "well on the highway". Do you mean fast enough to keep up with out shaking you to bits? Or do you want wind protection and lots of comfort? For the latter, you need to forget about the more dirt-worthy DP bikes and think about a KLR650.
Anyway, whatever you choose be sure to check out this site :crazedlist.org. It lets you search every Craig's List Site all at once and should help you find a bike easier.
So, you aren't going to push the ZX-14 with the Scorpion Syncs for trail riding?
+1 for the KLR650. It has the ability to cruise at 70-75 and enought tank range to do it for 3+ hours. The springs on both ends should be fine for 175lbs unless jumps are in your near future. Stoppies are not going to be on your daily list of things to do. Tire choice is good for street or dirt and everything in between.
I second the DR-Z recommendation. I have one, and it is excellent for most everything. It will cruise at 80 MPH if you gear it up, and is competent in the woods. You can get a excellent one for $2500 with alittle searching.
I bought a used 97 Suzuki DR650 a few months ago to get back into dual sporting and it's been a blast! Here's a range of possibilities, generally going from more street oriented to more dirt. Each bike has advantages and disadvantages:
Suzuki DR650 ('97 or newer)
Honda XR650R (converted to street legal)
Note that you can usually modify these bikes to be more of what you want. Add some DOT nobbies, firm the suspension, plus a bit more power for better off-road performance. Add a rack, bigger tank, and some extra wind protection for long adventure tours. Or do a little of both. More than any current class of bike I know of they're a blank canvas and you can really tweak them to what you desire - that's half the fun...
Get a high milage used SV! I bought my SV on Ebay in good shape with 45,000 miles for $2,200, no one was bidding on it because of the mileage. I have 62,000 miles on it now. A good friend of mine had over 100,000 miles on his. Randy O has over 123,000 miles on his. I think you can easily expect to drive an SV650 for 100,000 miles with normal upkeep. For long term riders you will be happy with an SV they are simply great fun! I have 700,000+ miles on bikes and it's my favorite of all time.