Recommend an $150 or less Co2 rifle

If you can return or exchange it, I recommend you do so. Over the years, the QB series usually had good barrels capable of dime-sized groups at 25 yards…and frequently better than that with certain batches of JSB / AA pellets. I’ve had dozens pass through my hands and it wasn’t until recently that I ran into a couple with bad barrels. That made me suspicious that quality control was beginning to slip now that Beeman is the sole US distributor, so I asked the community about their recent experiences and the feedback was all uniformly positive so apparently I just had a bit of bad luck. 

I should point out what I’m calling bad are barrels that grouped at 30 yards the way yours is grouping at 10 yards, so something is definitely defective and they should take it back. Then either try a replacement or give another brand a try.

If you decide to go with something different, I suggest avoiding the Diana-branded models from SPA like the Trailscout or Chaser. I’ve seen several examples (personal and on the forums) of damaged rifling at the muzzle resulting from the crowning operation. It’s a shame too because they do really well when the damaged portion is cut off and recrowned.

The Umarex Fusion or Sheridan 2260 run closer to your budget ceiling but are more likely to group decently out of the gate. 
 
Obviously, you bought used. From what I have always heard the 78 is very accurate. Have you cleaned the barrel? Also, check to see if the crown is damaged. 

I have an old Westernfield 822 (22 mag) that's accuracy fell to something like 3" @ 50. So bad that I put it up for yrs. Finally, upon reading-up I realized that as a kid, I alway would stick the cleaning rod from the end of the barrel. This damaged the inner rim. Finally, I took it to a gunsmith and had him lop-off 2" of the barrel. At 24" I always thought the rifle was too long for my hunting purposes. --- Anyway, after the cut and new crowning, she shot consistant groups 1/2" @ 50 and 1.25ish @ 100.

You may want to check this out.
 
I’ll look at those also!

For the foreseeable future, Mike only has them in .177. From what I've heard the .22s production has been hampered by COVID. I emailed him Sat and he told me he doesn't know when he will get them. He even throws in a power tune that increases muzzle velocity noticeably.

The rifle available there is the Xisico. It's a handsome rifle.

He's a nice man. http://flyingdragonairrifles.org/index.php?route=common/home
 
I've had a couple Crosman 1077s and Beeman QB78s.

The Diana Chaser out-shoots them in my experience. Plus you have the benefit of being able to switch from pistol/rifle.



https://www.pyramydair.com/s/m/Diana_Chaser_CO2_Air_Rifle_Kit/4613



I use it more than the others by far.

dianachaserapril2021g.1620159571.jpg

 
Both my Mrodair Plinkster and Diana Chaser had severe rifling damage at the muzzle. These guns are rebranded SPA models CR600W and CP2 I purchased about 2 years apart which tells me they have not corrected this very basic QC problem. Not all of their guns will have this problem but definitely check for it straight away while you’re in the return window.


In the case of the Chaser’s two barrels, only the rifle barrel was damaged. The pistol barrel was okay.
 
I would second the Diana Chaser. Got one around Christmas and love it. Not a super accurate rifle, but so easy to shoot. Very, Very quiet in the rifle configuration. Getting about 3/4" groups at 10 yards. So not a tack driver, but works for me basement range.

Biggest problem I've had with the Chaser is that the little magazine always seems to be empty. I fill it, and blink, there are more holes in the target and the mag needs filled again.

It seems to get about 6-8 magazine loadings for one CO2 cartridge.

Try it and i'm sure she will enjoy it.


 
Well the replacement QB78 came Friday but I didn’t have time to shoot it until yesterday. Tried a red dot and a CP 3x9x40. It shot better. 50 cent group at 10 yrds. But still the two flyers out of five shots. And the flyers are random and 4 to 5 inches in any direction. So not reliable enough to shoot squirrels with. It’s going back for a refund tomorrow.

Now I have to decide between the Crosman 1077 freestyle or the xisco. I’m going to do some research on both.