First of all, I love your voice. The song/mix is nice and calming. I think it works really well. I don't sense "mud." I see the slight muffle in the guitar as ambient and think it suits the song well. The only thing I have a problem with is the kick. Not in tone or volume but in its programming. The guitar is playing dotted notes and the kick is straight. It may be intentional but I think it throws the song off a bit. It's going "boom . . . boom - boom" when it feels like it should be going "boom . . . ba-boom," if that makes any sense. Otherwise, nice work!
Floreana, I stumbled on this. Listened to your mix 2. It's fantastic. I think it's an excellent example of using the SM58. I'd add, though, that the "master" version totally loses it. It's overcompressed, and too much boost in the 3Kish range. I think you're on to something with mix 2, as well as your songwriting and recording approach.
Here's an example of using only 57's to record a song. The All 57 Song by Kelly McGuire