Hi,
I currently own 3 Fender Squire Strats.
1) 1998 Mexican--Pretty Hot Pickups, Neck sucks, thin sounding, cheaply made all around, crappy frets.
2) 1996 Korean--Crappy pickups, fairly well made, overall low ouput, pretty good neck, more low end, better than the Mexican frets.
3) Mid 80's Japanese, Great pickups, Very well made, Wonderfull neck, Top liine hardware, Great sound--More selection of sounds in pickup selection switch. As good or better than any current real Fender under $900. Mine is mint and was not used very much..almost new, but has a great patina and feel. Wonderful to play.
Hot rodding or upgrading? Like a few others mentioned, you'll never get you money back. Also if you did change to better pickups, mods..you still might not winding up getting the sound you are looking for..then what?
If you can,buy a guitar that you can play and hear and make sure you play it throught an amp or setup that is similar to what you will be using at home or in your band.
Playing a $100 guitar through $5,000.00 setup in a store may make it sound great but let you down when you get it home and play it with your $400.00 setup.
Just another 2 cents ....
Peace...Ron