Cotton on have some really cute sundresses. They are a bit above knee length (I'm 5'7) they aren't a stretchy fabric, but have a stretchy waist so they nip in nicely, accenting your waist and covering any lumps and bumps. They come in lots of cute colours and patterns and are about $25.
I have a heap of these and lived in them when we were living in Darwin last year, Cotton On have brought them out again this summer
My only complaint is that in time (and with washing them constantly) two of them have shrunk and are almost indecently short. I think I got my $25 worth though, lol.