#1
I've been playing acoustic for a little over a year. I started with a Yamaha F-310 with a solid spruce top, and now I have a Seagull S6 with a solid Spruce top. I've never played any upper-echelon acoustics in guitar stores and was just wondering what type of things separate a quality $400-500 guitar from a quality $1000 guitar. Is it the quality of wood? Ease of playability? Just curious, any answers would be helpful. Thanks.
#2
Sound, quality of construction, quality of materials, etc.

A $3,000 Taylor will probably sound much better and project much better than a $400 Yamaha. Not to mention the Taylor will last forever and only get better with age.

That being said, I've ran into beat up, cheaper guitars that sounded a lot better than some of the really expensive ones. It's really subjective, but you can be assured you're getting a higher quality guitar.

Your ear also develops over time. You may hear a guitar today that you think is great, but a couple years from now you may realize that it was fairly mediocre.

If there's a GC in your town, head down and try out a few of the Martins and Taylors on the wall. Then go try out a lower-level guitar. You should be able to hear the difference and there's a pretty big difference in how they play as well.
American Ash Deluxe Tele
Squire Standard Strat w/ Texas Specials
'65 Fender Deluxe Reverb RI
'53 Fender Deluxe 5C3
California Dreamer
Valve Junior
2X12 Avatar w/ V30's
#3
This might not be the best comparison but I'll at least give you an example. I have a D-37 martin koa (1983), which was about $1,800 guitar back in 1983. And my sister has an Austin. (not sure what model or year but she got it for about $280) the Austin sounds way better than what she payed for it.
Anyway, it's obviously undeniable that the martin is a better guitar. the look, feel, and sound of the martin is sky high over the Austin. But I think one of the most important differences between a cheap guitar and an expensive guitar is the quality. Expensive/quality guitars will last a very very long time and will get better as time goes by(the price, obviously, also goes up over time), where as a cheap guitar will do the opposite.