If you want one that packs that small then you're pretty much looking at a down bag. Probably the best buy in your price range is the
REI Halo at $259. It weighs 1 lb 15 oz and packs to 8x17.
Personally I'd spend a bit more money and get a top of the line bag. If you take care of it it'll last for years so the extra cost really doesn't amount to much over the life of the bag. You'll also get a bag that is much more accurate temperature rating wise because it uses higher quality down. IMO the two best makers are Feathered Friends and Western Mountaineering, and if I was buying something to your specs those would probably be the only ones I'd look at.
The
FF Osprey is a °30 bag that weighs 1 lb 9 oz and packs to 6x13, with an Epic (way better than the normal material) shell it's $329. FF is a true custom maker, you can specify the color, fabric, etc. They also offer overfill, it used to be listed on their site and IIRC 2oz (which adds 5°) was around $10 extra. The next option is the °20 Swallow, 1lb15oz, 7x13 and $354.
The comparable WM model is the
Ultralite (°20) 1lb 13oz, 7x13, $385 or the 30° Megalite at $355, though I'm not sure if WM offers overfill.
FWIW, I have a 10+ yr old FF Swallow that IIRC was rated at 25° back then. I've slept in it below freezing more than once and was quite comfortable.