You already came to the right answer: the Leupold 2.5x20 is just about ideal. The Marlin in .357 Mag is neither a long-range nor a super-accurate rig. It is a flat, handy, relatively lightweight carbine. Optics should be simple and light and geared toward the rifle's purpose: striking an adequately powerful blow at relatively close range on a medium-sized critter, and doing so quickly. A 4x is about the most magnification you'd need; for that you might want to check out the Burris 4x20 Timberline (about $170) or the somewhat larger Nikon Prostaff 4x32 (about $100 at most Walmarts). The latter is intended for rimfires, so it's parallax-corrected at 50yd (rather than the 100yd of the usual centerfire scope), which is more appropriate for the .357 Mag. Plenty strong enough for centerfire recoil, however. While still a compact scope, it's as big as I'd go for your rifle.
Anything with more power and/or variable power rapidly becomes a lot larger and heavier, and ruins the balance and fast handling of a levergun. And, despite the 20mm objective, that Leupold will be just as bright as one of the 40+mm "moon scopes" from a cheaper maker.