Ask your neighbor what he thinks. Does his bike look more like the bikesdirect ones I posted? I'll bet it does.
If you plan to do any aggressive riding, for 1/3 more money I think either of those are no-brainers, unless you just plan on casually tooling around town. The diamond back would be fine, or maybe even better, for that.
If you don't want to spend 1/3 more, you could probably get an even better deal on Craigslist. Something like this (although it's kind of small)...
http://hartford.craigslist.org/bik/2615812540.html
Keep in mind though...a properly fitting road bike will put you in a more laid-out position. You probably won't find it as comfortable at first until your muscles get used to it, but if you're doing group fitness rides you'd have to be pretty strong to keep up on that.
Also...fit. How did you see if the Diamond Back would fit you?
Shorts...get the 2nd one. The first are liners for baggies.