A mountain bike is fine for general riding. You'll keep up with kids with it, and it'll handle the random dirt trail better than a road bike. A cross bike would probably be a bit closer to what you're looking for, but a full on mountain bike wouldn't hurt.
I would go to a local bike shop and hop onto a couple different styles and see what feels best for you. You don't have to buy one there, just use them for a test ride.
One thing you'll want to keep in mind if you order online, you'll have to either assemble it yourself or bring it to a shop to have it assembled. You'd be looking at $50-100 just for that, so keep it in mind. Even if you do put it together yourself, you may need a bike tech to work out issues like shifting or adjusting your brakes correctly.
Nashbar has some good bikes, and keep an eye out for their 20% off sales. They have them quite a bit. Here's some decent ones.
http://www.nashbar.com/bikes/Product_10053_10052_578124_-1___204686 - 20% off makes this a nice buy. 449 - 90 = 359.
http://www.nashbar.com/bikes/Product_10053_10052_555436_-1___205045 - More of a cross bike with skinnier 700c wheels.
http://www.nashbar.com/bikes/Product_10053_10052_552038_-1___204686 - The AT2 that you already had.
I'll throw one more out there, but it might not be what you'd like.
http://www.nashbar.com/bikes/Product_10053_10052_576973_-1___204686 or
http://www.nashbar.com/bikes/Product_10053_10052_559086_-1___204735
They're single speed, so you need to make sure you're ok with that. Yes, you'll lose all of those nice gears. Yes, it's got a solid front fork so no pretty suspension up front. Here's why I'd recommend something like this. The derailleurs and fork you get with a sub $500 bike are pretty crappy. They're fine for most people, and they work for the most part. The derailleur won't be very smooth though, and shifting will be rough. The fork will be squishy and the rebound will be so slow going on mountain bike trails will be very hard. You would definitely be better off with a rigid fork. You'll also get more bike because you're not wasting money on meh parts.
Either way, for general riding any will do. The Diamondback axis looks like more of what you'd want. I ride a single speed cyclocross bike and don't miss the gears at all.