As for feedback, with most amps if you are playing loud with moderate gain or higher you need to keep you hands on the strings to mute them and keep the feedback at bay. If you are still getting feedback then something is probably broken or not adjusted properly. Maybe your pickups, if mine are too close to the strings that tends to happen. Plus my tone sucks if its not just right. You may just need a decent setup done, but adjusting your pickups and bridge really isn't that difficult but if you don't know what your doing you may as well take it to someone. Honestly with what you have you should be able to get a decent tone of something. You may be shooting at something your rig just can't do and thats why it sounds like crap. Like I wouldn't be trying to get metal tones with that setup, but some really nice cleans or bluesy to rock tones should be fine. Obviously I don't really know that but from the fender amps I have played and the strats I have played thats what I would say. The single coil pickups (if thats what you have) are gonna hum and give more feedback at higher gain, because they aren't "hum"-"buckers".
Like Kevin said you may just want to get a overdrive pedal and maybe an effects pedal or two, I own no effects just a distortion pedal and a wah but I also wish I had a bunch of effects... MoogerFoogers anyone? wish they didn't cost an arm and a leg each but whatever. The point is that you should just mess with it till it turns out something you like, there is no reason with that setup you should;t get something, unless like I said, you are shooting for something it can't do or something is broken.
Thats my two cents on the subject, but I may be wrong.