In addition, from my own experience, last year I upgraded from a $200, 28lb. WAl-Mart flat bar "road bike" to a $800, 23lb steel Jamis proper road bike with Sora groupset.

Doing so is likely the BIGGEST UPGRADE I will ever make in my cycling life, as it moved me from near the slow end of my club group rides to somewhere I'm the middle...even if I were to again quadrouple the money and buy a $3600, 16 lb bike, I doubt the gains would be as dramatic as going from $200-$800....perhaps equivalent on climbs, much less so on flats. I still wouldn't be the fastest in my group without much more training.