The best advice I can give is - DON'T GIVE UP - and give you my personal experiences on my journey thus far.
Look at my gear list in my sig (then theres a link to something I recorded and released) - cheap and modest at best. It's all I have had for a number of years.
I never thought it was possible to get pro-sounding stuff out of my gear but then I discovered the work of some of the people mentioned in this thread and heard what they were doing in "less than ideal environments" and with a modest selection of gear and it blew me away. I started to read a LOT and put what I had read into practice and my stuff started sounding better.
I still think I suck at it and I know I have a long way to go still. When I do a song myself I'll print 9 or 10 versions of it. When its "done" is when I don't know what to tweak anymore or I'm fretting over .5 of a db.
When I'm mixing RAWs, I'll work for a few hours until I have all the sounds and I'm happy with it then get critiques on it. I have been told my mixes are pretty solid and people suggest one or two things that I might change (which I love - feedback is good!) and a lot of the changes can be done in a few minutes.
I use reference mixes and listen on as many different things as I can (my own rig, my wife's car, iPhone speaker, earpods, different pairs of headphones, boom boxes in Best Buy!). I mostly mix on my headphones because my current speakers are fucking awful at reproducing anything below 56Hz ie. they don't! I use a spectrum analyser and compare the overall spectrum of my tracks with mixes ripped from CD to WAV to give me an idea of where I'm at and I'll consider what I see but not take it as gospel.
I keep practicing with as many raw files as i can, inbetween writing my own stuff. It's fun, and it's the only way I'll get better. I have the time at the moment as I moved to the US from the UK late last year and got married, and I'm still waiting on my green card, so no job at the moment. My wife and I want to get a house of our own (working out of my inlaws' box room right now!!!!!!
uke
and I plan on building up a dedicated somewhat treated room and getting AT LEAST a better interface and better speakers.