Since you say that it will not be for concealed carry - I would suggest you go with your first instinct - get a CPO P226. If you prefer a W. German - you should be able to find one of those in your price range as well. When guys online talk about SIGs being really expensive - that is because their research has only entails going to SIG's website. A 5 minute search will prove many available locations for under $600 SIGs that are in good condition. Here is one of many dealers that have CPOs:
http://mactec-militaryarms.com/sigsauer.html (btw, I have no connection with them and also haven't done any business with them - so i can't tell you about their service.)
If you want a P226 - go to sigforum.com and look at their classifieds section - you might find a good deal there - and also you will find some of the best online dealers on the market. I have done business with 2 different companies that have more than impressed me with their service and here is my shameless plug for them: Steve at SCP firearms -
http://www.scpfirearms.com/products.php?cat=firearms and Keith at CDNN -
http://cdnninvestments.com/ -- a quick call to either will render alot of information. Last time I called CDNN - they had a very good to excellent used P226 for under $450. I would suggest buying a used - in good condition P226 - and spend the rest of your money + some and send it to Bruce Gray for a trigger & action job. - this would be a much better route than a NIB SIG.
The P226 fits your criteria to a T - as does the HK P2000V3 and the CZ P-01, which is what I will be buying next as I already have the P2000, G19, and P226. (It is my opinion that the P226/228, P2000, and P-01 are the best DA/SA autos on the market.)
Glocks, XDs, M&Ps, etc do not fit your criteria as they do not have decockers nor are they DA/SA - I don't think everyone fully reads an OP before replying.
Now if you said that you were shopping for something to carry - I wouldn't suggest the P226 - it is large. But since that is not the goal, the P226 will be great as a range/HD gun. It has a good sight radius. For carry I would suggest the P2000 or the P-01. Honestly, I go back and forth between which I like more between my G19 and the P2000 when it comes to compacts. My P226 is my baby - I wouldn't think of carrying it.
The truth is that unless you have amazingly more willpower than the rest of us - this will not be the last handgun you buy, so with that in mind - the question should be "which one do you want to buy first?"
P.S. - ok, so apparently I don't read the OP that well either! The P226 does not have an external safety. Now, I would argue that you don't need an external safety, but if this is one of your criteria - then the P226 does not fit it.
In fact, as far as I know (and I am sure I am forgetting several) - right now I can only think of 4 handguns that would fit your criteria for a DA/SA w/ a decocker AND an external safety - Beretta Px4, IMI Baby Eagle, HK USP and HK USP compact. For carry - the USP compact is great (same size as the P2000) - for range, the fullsize USP would be very controllable. Now here's the kicker, NIB USPs are just above your price range. I think CDNN has them for $659. You may be able to find a used one below $600 - but I wouldn't know where to find one. The Baby Eagle and the Px4 are both within your price range, and both fit all of your criteria - but the safety is on the slide. They fits the rules the best, but I personally despise slide safeties.
My suggestion (and only because I don't like slide safties) - forget the external safety - learn to control your primary safety (trigger finger) and buy the P226. Good luck!