Maybe I misunderstand your question but the guitar being played in the video is a steel string guitar. It would be hard to get his sound with a nylon string instrument.
To answer your question you will get a much truer more natural sound recording with microphones then with a pick up. A Cordoba C9 or C10 is with in your budget, both are all solid woods. You can always have a K&K pick up installed later on if you like. Plug and play does have it's advantages when playing live on stage.
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