Looking for some advice...

A bike to convert can cost a LOTS less than £100-150.

it could range from free to £50 easily if you know where to look, especially if you ask relative and friends if they have any old bike in the shed.

a complete rear wheel cos £75-100 OTP, and you're sorted (once you get the small stuff sorted, i.e. chain).

You're right, it could cost a lot less. I was thinking more along the lines of a cheap 531 steed or similar - whatever would be the best available within budget. I did neglect to mention the OTP option for the rear wheel too... but building wheels is fun!!! :)