well it largely depends on what your personal preference is. in the realm of electric guitars there are basically two types. The first type has 3 single coil pickups. i.e. Fender Stratocaster. The second type has 2 humbuckers, or double coil pickups, i.e. Les Paul. Everything else pretty much stems out from there. There are some exceptions, i.e. the Fender telecaster or certain early-model Gibson guitars with P-90s, but that pretty much covers the basics. They each have a distinct tone, and pretty much the only way you can decide which one you like better is to play as many different guitars of both types as possible. People will tell you "Oh, if you want to play metal you _have_ to get an *insert one of Ibanez, B.C.Rich, ESP, Washburn, blah, blah, blah*, but that's a load of bull. Kirk Hammett (of Metallica fame) regularly uses strat-type guitars. You can play whatever type of music on whatever type of guitar you want, as long as _you_ like the sound. That being said, if you want a "classic" sound, then you're probably going to want a "traditional" guitar. In other words, if there's a guitar player whose sound you idolize, then go find out what their rig is and copy it. After 10+ years of playing you may be able to passably sound somewhat like them. If you pick a sound/style you like, the only limitation is your skill.
but enough with the rant. Guitars in your price range. If I had $500 to spend on a guitar today, I would more than likely buy a Fender Strat. doesn't matter if it's made in Japan or the U.S. or Mexico as long as it sounds good. One of the tricky things with fender guitars is you can have 2 guitars that are exactly the same year and model, but one may sound good, and the other may sound like crap. Caveat Emptor. Another option is G&L. You have to order new models online, but you may be able to find a used one or two in a local music store. Their models are similar to fender's, but about a thousand times better in terms of sound and construction quality. If you despise single-coils, then try to find a used Les Paul or SG. And whatever you do, make sure it's a Gibson. Epiphone's aren't good for much else than firewood. Ibanez's are all right, but I prefer the higher-end models like the Joe Satriani or Steve Vai signatures. Musicman makes a fairly decent guitar as well, but they may be a bit out of your price range.
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