dude, the only guitar i know of that has the pickups labeled rhythm and lead is the gibson les paul. and for starters, it CAN be misguiding. most people think rhythm=rock/metal rhythm playing, and lead=leads. now keep in mind how old those guitars are! back then the NECK pickup used to be the rhythm pickup cause it's better for CLEAN stuff!
of course it's gonna sound like shit if you try and use the neck pickup for your distorted rhythm work.
and as for the mix thing....bro, unless you're planning on playing alone in the bedroom (and not even then IMHO), using the settings you wrote down IS NOT GONNA CUT IT. PERIOD. even if he's not after a good recording (=mix) tone, you should keep in mind that when playing with a band the guitar "mixes" with the other instruments, and then the same rule applies. guitar=MIDS bass=lows drums=extreme lows and highs, but basically covering the whole spectrum
i don't wanna come across as a dick here, sorry, no offense intended, i just feel i need to keep the kid from getting into the whole scooped mids=br00tal thing. especially for stuff like primal fear who tend to have quite a midrangey tone last time i checked. if i were to suggest some settings in the vein of pantera or metallica's and justice for all, i'd second your statement, but as it is right now that's like saying he should use two boss metal zones in series to get that authentic ac/dc sound
ok, let's stop the pseudo flame war here and try to help him.
i'd say reduce all the software and pedal crap to a minimum and try to dial up a decent tone going guitar->v-amp. of course a real amp properly miced up using a good mic preamp is likely gonna sound better, but the v-amp is fine for doing quick demos. remember, some of the leads on the latest nevermore record were actually done using a pod xt!
i don't have a vamp, but a pod, and seeing how the vamp basically is behringers line6 ripoff, i'd suggest the jcm800 or modern highgain (iirc there's something like that in the vamp) models. experiment with different cab simulations. i'll say it again, you should really try to get the best possible tone without any sort of outboard processing...you can't polish a turd in the first place, remember. seing how you have a boss ds1 distortion rather than the sd1 overdrive, i recommend you stay away from that one....it's not gonna work well as a boost, and for primal fear kinda sounds it's not gonna cut it as a standalone unit providing all the gain.
what's your setup like? are you using the vamp directly into your pc or what?