This may be beyond the realm of "reasonably priced", but Perigee in the Distillery district at Front/Parliament is well worth a visit!
Also pushing the boundaries of fiscal responsibility is George, on Queen St. just before Jarvis. Great place for a special night out.
if we're going distillery area.... you can defintely downscale it and go to mill st brewpub. nothing is over 14.99 except for an occassional special dinner at 15.99 and the food is pretty competent for what it's worth. beware of the salads as they're a ridiculous portion in themselves. loooooooove their onion rings and sweet potato fries. wasn't impressed with the burger but the complete dinners are pretty darn good.
the wit beer is fabulous, probably the best canadian microbrew i've ever had in toronto thus far.
Directly in your specified area, there is:
Le Petit Dejeuner
191 King East http://www.petitdejeuner.ca
Quirky little place, cool decor, great food, $30 prix fixe. Service is friendly but they often seem understaffed.
236 King East
People couldn't rave about this place enough when it opened last year, but now I never hear a thing. Might want to search some recent opinions on it before going.
169 King East http://www.kulturarestaurant.com
This is the current "it" spot for the trendies. Might be a tad more expensive, though.
If you're willing to wander an extra five minutes or so east:
354 King East
Awesome little bistro place with a small but excellent menu. Prices around $20 for mains. Friendly service, relaxing experience.
Finally, if you're willing to wander an extra five minutes or so west:
18 King East http://www.beerbistro.com
Great food and it all has beer in it, used in some creative way. Huge international beer menu, needless to say. Can be filled with the business crowd on weeknights, though, I prefer Saturdays.