Royalty free music does not mean free music. Any search of Google for Royalty Free Music will yeald hundreds of places that sell music for one time price, never pay again, ASCAP free.
Since music on hold should only be short snippets (15 seconds at best) you don't have to spring for whole songs. You should be able to get a nice collection for $25-$50 bucks.
If you go with a professional music on hold outfit, they have the music available.
You might also ask a friend with a piano or such to do a few bars of his own music for you, and record it. We did a radio commercial once with banjo music in the background composed and played by the hardware store owner.
BIG Mike