There are some decent beginners guitars, held back in part by trying to be as indestructible as possible -- tops that are too thick, over braced, and encased in way too much finish. I always wondered how they would sound if the finish was stripped, scrape down the top, and thin the braces.
Let's find out.
My test mule will be an Orangewood Oliver, which I picked up for $170. Solid mahogany top & neck, rosewood fingerboard/bridge, bone nut/saddle, the tuners tune, and well pretty much everything else doesn't matter.
With a couple thousand dollars worth of labor, we *might* be able to make this sound as good as a $500 guitar!
Initial thoughts on Oliver before getting to work: the fundamentals are good. My only real complaint as a "beginner" guitar is that the frets are very rough / not polished - otherwise the setup/playability is solid. It is not very loud, which is probably a positive for a beginners guitar, and I like the fundamental tone. The overtones are lacking-to-non-existent, which isn't much of an issue for a beginner.
And it is really pretty nice looking, very dark.