she thinks it's prettier
You can get the iPhone 4 free for £30/month. It would probably suit her perfectly. It's slightly over budget but not by much.
Granted it's a 3.5" screen and not 3.7", but that doesn't really matter.
What are the text/minutes though, I always find Apple are the absolute worst in charging for crap minutes.
I've recommended the Desire S and the Galaxy W. I took her into CPW to see the Desire S and she thinks it's prettier than the Galaxy W so I think it's the current favourite.
Apple don't have anything to do with it really, it's just the networks ripping people off due to the popularity of the iPhone!