Well for £200 you won’t get a HDD cam, unless you find a great deal or maybe in import or ebay. Closest would be a entry level JVC MG21, which I’ve seen for £230. You can’t get a decent DVD cam either for £200.
In terms of quality, HDD cams and DVD cams use the same MPEG2 technology… so there is no advantage there for HDD cams. HDD cams do have some advantages in terms of use, e.g. with DVD you are limited as to how much fits on a disc (20 minutes in best quality mode). But if she wants to shoot and pop into a DVD player, then DVD is the only format which does that. And they are a bit cheaper than HDD, so you can get more for your £200.
Panasonic Panasonic VDR-D100 is a decent entry level DVD cam, available for £228 here
http://www.cameras2u.com/products/de...257d1df9993571
In this price range she’ll get better quality for the money with a DV (tape) model such as the Canon MD101… but with this she would have to either capture to a PC, or use a DVD recorder, to create DVDs.