Hey up Stargirl - nice to see you back on the forum
Of course, a more expensive mic will produce a higher quality sound, otherwise there'd be no such thing as a very expensive mic.
Having said that, a better mic will capture the full sound of your voice, and you'll prefer it to a crappy mic.
I would recommend spending as much as you can on a mic if you're keen to get a decent sound. A condenser mic is usually better for vocals, although I did hear on the telly the other night that Alison Moyet recorded Yazoo's Only You vocals using a Shure SM58... So a large part of it is in the fiddling with buttons & faders (or software these days.)
Personally the best sound for the pounds I've heard is the Zoom H2
http://www.zoom.co.jp/english/products/h2/ it's much better than it looks and it records direct to its own memory as an MP3 file which you can download later. Great for recording practise sessions and the like. I'm sure it can be used to record as part of a multi track setup too.