So I've been thinking about this and, even though it's kind of impractical, you could probably get away with using the free version of C2 to make your video, considering your financial restraints.
See, my thinking was that starting a Kickstarter without actually having made at least the core of all the components of your game that you're promising is kind of unethical, or at the very least asking for trouble. But if you take the time to make, say, a few different demos, each showing different components of the game - stringing them together into one "gameplay" video is a good balance between getting the core work done and showing people what they need to see to become backers.
That way you've actually made the bits that you're promising - you know that you can do it, and you're able to prove so - and when it comes to building your full game you would have the core/engine work done already. Moving events and objects between projects is cumbersome but doable, and while it'll ultimately make for more work for you, if you manage to get the funding you need then it'll work out in the end.
The only issue is releasing a playable demo, but you can get away with not having one if your gameplay video is compelling enough. If you can show that you can deliver, then most people will be satisfied.
With regards to your Kickstarter, I'd suggest definitely aim on the lowish side, but not so low that people don't take you seriously. Bear in mind that most "low-end" Kickstarters seldom go far into stretch goals, so don't budget for it. Something between the $1000-2000 mark should cover your basic software licences (not sure what image editing software you're using, but even something cheap like Graphics Gale will work for your project), outsourcing music and sound effects (although you can generate 8/16-bit SFX for free yourself), and maybe paying for any additional programming or artwork you may need.
When you do launch your campaign, don't forget to hit up every single gaming/indie site you can find. Any bit of coverage will go a long way - this is one of the biggest mistakes I've seen small groups make.
Phew, sorry for the lecture, but I like the look of your game and, if you can really pull off what you're aiming for, I think it could be successful.