I absolutely LOVE the diving on Cozumel, and for me,nothing on the mainland, from Cancun through PlayaDel Carmen to Akumal comes close. And yes you CAN do Cozumel on a very tight budget - I've done it many times. First step is to NOT fly into Cozumel. For some reason, i have not been able to find any budget-friendly air fares into Cozumel this year - and I've been looking. BUT, going Southwest, I can fly DAL-HOU-CAN round trip in early December for $366 - over $300 cheaper than AA Non-stop DFW-CZM. and BONUS - on Southwest, you can check two bags for free, while AA charges $25 per bag, NO bags free. From Cancun Airport, take ADO Bus to Playa Del Carmen, PDC Ferry to Cozumel. About $34 per person round trip.
There are a lot of very cheap options to stay -hotels with fairly spartan, but clean accommodations for as little as $25-30 a night per room. for a little more, you can even get a room on the waterfront (or at least on Melgar downtown facing the water) for $65 per night for a double room - the rooms at Suites Bahia and Casa Mexicana include a breakfast buffet. And there are plenty of good dining options from as little as $20-25 per person per day; even less if you make the Loncheria lunches your main meal of the day, 75-85 Pesos (about $5 plus tip) for a lunch with Chips and Salsa, Soup, entree with rice and beans, and agua fresca to drink. Then do one of the many Taquerias backin town on 30 or 65 for cheap but very good street tacos for dinner. Diving is likely to be your biggest expense of the trip, budget at least $60-$70 per person per day, PLUS enough to give a $10-15per person tip to the DM and crew.