1) Something that packs a punch.
2) Supports cheap and easy to find ammo.
3) Bolt or semi is fine.
4) Easily upgradable/modifiable.
5) Ammo can be used in other commonly found rifles.
6) Not a Mosin Nagant (I'm already planning on purchasing one).
7) Under $500.
Any suggestions?
1) This can mean a whole bunch of things to a whole bunch of people. Need more info.
2) Cheap like "surplus" cheap or ???
If the Mosin Nagant is out (and I'm totally with you on that one) that leaves the 5.56x45 NATO (.223 Rem), 7.62x39 (AK, SKS, Saiga and a few bolt guns), and 5.45x39 (AK and Saiga). The .308 and .30-06 are probably the next ones on the list for "cheap" and "bolt or semi". If you plan to reload, then the world is your oyster, and I pay for a new set of Lee rifle dies the first or second time I take the rifle to the range.
4) What kinds up upgrades/modifications are you talking about? When you bring this up I start thinking AR-15, but not likely to hit your $500 target.
5) Why? But regardless... The 5.56/.223 Rem, 7.62x39, .308, .30-06 probably top the list.
7) SKS, Kel-Tec SU-16, Saiga, Savage 11/111, Marlin XL7/XS7, Stevens 200.
On that list I have a SKS, SU-16A, Savage 11, Savage 110. All of them are very good at what they do.
Savage and CZ make bolt guns for the 7.62x39. Of the two I'd go with the Savage.
On the cheap I'd go with a Chinese/Norinco SKS or Stevens 200. SKS for "firepower", whatever that means, or for a "truck/trunk/ranch gun" and Stevens for accuracy. The Savage will have a better trigger out of the box than the Stevens, but the one on the Stevens can be adjusted to be just as nice. The Stevens can use the same "upgrade" parts as the Savage.
Both of my Savage centerfires shoot 1/2" to 3/4" groups.
The SKS or any of the AK/Saiga rifles will probably shoot no better than 3" groups at 100 yards. Fine for many applications. The Stevens will likely shoot 1" groups.
If you get a bolt action, also plan on some money for a scope. As for the SKS, I've yet to see one shoot better with a scope, and some a lot worse.
I have a BSA red dot on my SU-16 and it shoots ~1" groups at 50 yards with cheap Wolf ammo (the dot is bigger than my groups FWIW). I have shot 1.5" groups at 100 yards with XM-193 with the irons. You can do some of the same modification of a SU-16 as with an AR (rails, collapsable stocks).