I'd go with the latter, the Squier is great all by itself, let alone being great for the money....Not to start a tussle, but I play my Ric 4003 side by side with my VM jazz and wow, they're pretty close. The Ric feels a little nicer in terms of fret work, it's more even across the neck and so it gets slightly lower action. The tone is a little punchier and cuts through a little more.
Other than that, they're very similar. The Ric certainly isn't $1900* better, which tells me that either the Ric is a ripoff, or the Squier is an outstanding bass for the money.
*Canadian prices, $2200 Ric, $330 Squier
Its a bit complicated. It did raise the action a little compared to the stock bridge, but with the stock bridge there was bad fret buzz and dead notes on the upper frets. I had to remove the stock shim to fix this, but I added a smaller shim (just two pieces of regular paper) to bring it back up a hair for the Gotoh.
The action is ok (just ok) now, I would like it a hair lower but the saddles are bottomed out. I could add another shim to the neck, but I'm afraid the upper frets would start buzzing out again. Complicated balance!
I think you should be able to achieve a decent action with a bit of hard work. Add small shims slowly until you achieve the right balance between fret buzz and action.
Have you considered a fret job?