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Yeah, you should have plenty of headroom, I had a guy who is nearly 7 feet tall in my passanger seat the other day and he still had a little head room.
As far as getting up hills, the Matrix XR is NOT a powerful car. You should test drive it and decide for yourself if you think the engine will cut it. If you're concerned about getting up hills, stick with the 16 inch wheels. Smaller diameter wheels = better acceleration (and lower top end.)
That deal sounds pretty good. I got my 2005 XR with sunroof, 6-speaker with in-dash 6 cd changer, manual 5-speed, fog lights and body thingies, Toyoguard, front airbags, and such for $17900 after markups and whatever.
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