#1
Alright guys, here's my current situation.

I'm in a band as of now, and I'm using the Cube 60 I own, running an Epi SG Special into it (My first guitar).

My budget at the end of July-Early/Mid August should be around 600-800 Dollars.

What I have:
Epi SG Special
Cube 60
Nothing else really (Strap Locks, cables, tuner, blah blah)

What I have a choice to buy:
~600-800: Used JCM 800 212 or 112 on Ebay
~450-600: Used/New PRS SE Custom or Ibanez SZ520QM (I'll have to go to GC and try them out before I choose if I take this path)
~200 (Cab), ~450 (Guitar): Extension Cab (212?, most likely Avatar) and save up a bit more for the Guitar. (This would result in me buying a 50w tube head/112 in the future, but I'm not sure how long down the line)

Those are my only real options. I want a nice modern rock sound, my guitar just isn't cutting it as far as playability and sound. It's got muddy pickups, they suck compared to some other pups I've tried. But then again, would they do ok with some tube distortion behind them?

Or should I buy a guitar with nice action/sustain, good pups, and that isn't beat to hell? Or should I grab an EXT 212 so my cube has better projection for the band and then pickup a guitar? (Note: If I make enough money I might be able to do both guitar and cab at the same time, if I buy used).

Which do you guys think I should do?
#2
What you want to do is buy for the long term. But you also need to consider your current needs, if you want to start gigging the Cube 60 on its own might not cut it.

IMO an extension cab (and a decent one too) would be good because it gives you the opportunity to expand later on, and it will give you better projection. In your situation, spending lots on a guitar won't help much, because it might not be heard. Make sure you try the cab first though, to see if it will actually be loud enough. Otherwise a used tube combo will be a good option.

Your guitar will still hold you back, but in reality no one in the crowd will notice a bad tone if you play well. A local band here has awsome energy, they are great musicians, and are a blast live. They use a JCM900 and the lead player uses a Marshall jackhammer. Needless to say, thier tone is crap, but no one cares. (As long as your guitar holds tune.)

I play with a $200 bass, but I have a $1400 amp and I can get a good sound. I've even gotten compliments on my tone, so really, being heard should be a bigger priority. Like I said before, great tone is useless if no one can hear it. (And anway, most of your tone is in the amp.)

If you do get the extension cab, make sure you get one with a wattage rating and an impedance that will allow you to use other heads with it in the future.

What I'd do in your situation: cab, guitar, head, then possibly another cab if I need it.

Just make sure you try everything before you buy it, and if you can do it with your band in a few different rooms. Amps and guitars can sound really different in the store. (This is where a good returns policy is handy.)
"You can practice to attain knowledge, but you can't practice to attain wisdom." - Herbie Hancock