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The prize structure seems lacking of explanation.

Is this correct for a $250 non-DC league?

$250 to the points leader and $250 to the head-head-champ at the end of 13 weeks? Then the top 4 teams, (all points or what?) playoff for the 3 prizes of $1550, $500, $250.

That is correct. Here is the playoff format from our Rules section:

Teams will play every other team in their league once in head-to-head competition, with the team with the best overall record and the team with the most total points (not counting h2h champion) earning playoff spots. The team with the next best record and the team with the next highest total points also advance to the playoffs. The four playoff teams from each satellite league will carry their weekly scoring average from the regular season into the playoffs and add that to their totals from Weeks 14, 15 and 16 to determine the top three finishers in each league.