Yes, they're cheaper elsewhere, but remember... it's CA.
$400 out the door isn't all that bad. DROS is $25 (or has it gone up again?), so that's $375 for the gun (assuming you didn't also need to obtain your HSC, which is another $25, and I know at least one dealer in my area who charges a $4 "handling" fee to take care of the paperwork)... minus the 7.75% sales tax (in my area) brings the base price down to $348.
I almost bought one of those surplus P225's myself, but I couldn't get past the lousy finish. Mint bore, yes, but maybe 70-80% condition on the exterior. Still functionally sound, though.
In any event... YES! Get one. You can't go wrong with a Sig out the door for $400. [FYI - I picked up a Sig Pro SP2009 for $399--not including tax or DROS--shortly after they were replaced by the SP2022. I'm giving it to the stepson for a 21st b-day present... *IF* I can control the urge to shoot it myself first!!!]
And FYI - Sig has a program called the Sig Service Plan for used pistols. See http://www.sigsauer.com/CustomerService/SSP.aspx for more info. They'll tune up your P225 real good!
Of course, you still have to ship them the pistol and pay for the service, so you might just want to bide your time and save up for a new one.
Or you could get a brand new, shiny Bersa for probably less than your surplus P225.
John
Edited to add: In December '07 the P225's were selling for $380 "on sale" where I live (regular price $450).