Yeah, I hear you about trying to work with what you got. Spending a little extra money wisely, tho, can make all the difference.
I didn't see a mention as to how big the amp was or a model, so I'm guessing it might be a little 10 watt practice amp, since you're placing your mic so close to the speaker to get the sound I heard. If I'm wrong, let me know. I know that all I had for the longest time was a little crappy Peavey 15 watter, and a slightly better Crate 10 watter, both the kind of amps you get with the Christmas guitar packages. Good for practice and fooling around, not good for much else that I've found.
I know a lot of people on these boards just kind of throw around the necessity to buy $500 pieces of equipment when you're really just trying to get by with what you got. In this case, tho, you really will benefit big time from a better amp. I finally got around to picking up a Peavey Classic 30, and I was simply astonished at the difference in sound over trying to mic my practice amps. I'm as amateur as they come, but even my n00b ears know a good sound from a bad one.
More details about your recording rig might be in order for better help, but I think the amp is the first place I'd look. The SM57 is capable of handling a bigger sound that what you're giving it. If you want equipment recommendations, you'll get an earful when you ask (and an earful when you don't
). For instance, maybe what you really want (but don't know yet) is an amp modeler instead of mic'ing an amp.
-Afficianado
PS - Yes, I'm quite aware of my lingo choices when I choose to use "mic" instead of "mike" and "mic'ing" instead of "miking".