I think it would depend more on what you plan to do with the car than anything else. As a daily driver, a Prius is not a terrible option. There is plenty of room, they are very ergonomically pleasing, and ultimately end up being a fairly decent place to be when traveling from place to place. The problem is that Toyota didn't really think about adding any fun to the car until very late in the MKII model years, and now that we are in the MKIII, they do offer a sport-oriented (well, as sporty as it gets anyway) option.
Surprisingly, the early MKII cars are very cheap to come by in the US. I was surprised by how many can be had for right around $10,000. Reliability is supposed to be quite high, and they make it sound like replacement parts are not as ridiculous as one might think. That is very surprising, considering how cutting-edge the cars were when they came out back in 2004.
I personally have a sick, twisted fantasy with buying a black MKII car and going to town with some aftermarket bits and pieces to have it be taken a bit more seriously. A lowered, tightened suspension would liven the car up substantially, as well as changing out the older eco-tires for the modern, less-compromised versions. I wouldn't expect the fuel economy to be altered too much, and surely the overall "fun factor" would increase slightly. Maybe making it drive more like a Corolla S and less like a loaf of bread on wheels...
Still, being that you are in the UK, you have much better options to choose from if you are looking solely at fuel economy. The VW Fox or Polo come to mind in basic transportation, as do some of the diesel Ford Focuses (Foci?) and so on. I'd love to tinker with a Prius myself, but the extra costs involved may not make it worth it to other people.