I'd say that it sounds like a pretty good price. Are you talking about US$80 or NZ$80? If it's NZ$80 it's a really good price.
If you do not need fancy stuff such as a color screen or gapless playback, the HD5 is great. When I bought my second hand HD5 earlier this year, I was surprised at how small it is for a 20GB HDD player. It also has got a 100% user replacable battery. A very wise choice by Sony.
It does have a line out option in the menu. I have never used it, but I've seen it. If you set line out on, the volume will be mxed out, so remember to turn the line out off before going back to headphone listening...
Here's a thread about the line out:
A thing that can be negative to some is that you have to use Sony's Sonicstage software when you transfer music. If you use some other software the player's database will not update properly. I do not find Sonicstage that terrible. It might have been bad in the beginning, but the last version released isn't that bad.
What else is there...
Ah, most of the HD5 sold in Europe have volume restriction. You need to enter the service menu to remove this. If the HD5 you are looking at first was sold in New Zealand , it might not have that volume restriction.
Here's some info on how to remove the volume restriction and make the HD5 louder (remember to not fiddle around too much in the service menu.):
If you do not mind not having gapless playback, and being forced to use Sonicstage to transfer music, the HD5 is a great choice. Soundwise is is still a good choice.