[FrankHudson]

In my mind, there are three things here.

1. Playability and mechanical issues. If you can, with whatever guitar you learn on, get a good setup done. This could cost as much as a cheap instrument, but it's more valuable than the instrument itself in allowing you to learn. If you can't get this done (rural area/no funds available for example) consider learning how to do a basic setup yourself. I learned from Dan Erlewine's books myself, but there are probably online resources to be found too.

2. Timbre/"tone" Different electric guitars sound different, and different guitar amps sound even more different. However, unless you're focused already on a particular sound, there's no reason to obsess at first about getting the right amp, even though it can be very important later on. An inexpensive modeling amp (which you seem now have) it a good way to start exploring amps and effects, as even the most meagre of them will let you experience various timbres and help you find your place among them.

3. Worry that you don't have a good enough guitar. While a good guitar can motivate learning, that's not the same as saying that shopping for a better guitar replaces learning. I can't judge your budget or the compromises it would take to get a more expensive guitar. I can't see your guitar and hold and play it. Here's one way to approach your wish to get a better guitar: set yourself a goal in regards your electric guitar playing. I can't tell you what that goal is, you need to look to yourself to find that. Promise yourself when you achieve that goal, then (and only then) you will look for a different or better guitar. And don't forget the possibility that even the better guitar will benefit from a setup.

We're in a wonderful world as far as cheap electric guitars go. In US dollars $200 to $500 can buy a lot of good instruments.