Costco bikes aren't necessarily bad bikes. My folks got me a 21 speed bike in 1991 to replace my 10 speed mountain bike. It was a "Motiv" brand from Price Club (now Costco). The model was "Stonegrinder" I think. I still have that bike, and still ride it occasionally. It had decent stuff on it from the get-go -- Shimano freehub with 7 speed cassette, Shimano STX rear derailleur, Shimano Altus front derailleur, Shimano trigger shifters, etc. It had Shimano cantilever brakes, but I swapped those with Avid V-brakes and Shimano EF-51 trigger shifters/brake levers. Still works great.

That's not to say that all department store bikes are good; I think we got lucky with this one (having good components).