Possible lead for you...although I don't know a lot about them (ie whether they make cedar tops or if they're available in the UK).

I've started seeing a few Blueridge guitars showing up around here. Seems to be the guitar people take to a session when they want to leave the Martin at home.

Nice sound and good action (tried a friend's) and I believe their mid-range models are about US$500...which is in your approximate pricing (haven't checked the exchange rate today. ;-)

Peter