quick answer..it will be worth it.
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I would go with the RED. I have one and it is quite good. The headshell is the part of the arm that holds the cartridge, as in this arm has a removable headshell. What you are referring to is the cartridge BODY , as opposed to the stylus, which is the removable part on yours. You can also upgrade the stylus on the RED body later if you want to.
No experience with the Dual 505-3. But if I were in your position, I'd probably be inclined to replace the stylus on the current cartridge. It would be the easiest solution. And also cheaper--the OM10 stylus at Garage-A-Records is about half the price of a new Red cartridge. Plus, I don't know what was originally used by the 505, but the OM series would be closer to original.
Normally, I would not go with the OM40 stylus--it does seem like overkill for a budget turntable. Although, the price you can get does make it very attractive. For less than a new Blue cartridge, you'd get a stylus that's much BETTER than the Blue.
I hope you enjoy the 505--it was, as I recall, considered the best budget turntable in some circles once. A cheap 503 which I bought to play with has--frankly--amazed me.
Thanks for the replies thus far.
I think I will go ahead and simply replace the stylus with the OM40.
However, I may also get the cheaper OM10 as well and swap that in when spinning less than perfect vinyl, as i'm told the om40 would wear out too quickly.
My associated gear is:
Sugden A48b (modified)
Rega Ara speakers(soon to be Epos ES14 with matching stands)
Rotel RCD971 CD player
I'm hoping the Dual will outperform the Rotel as a source, since i'm not overly thrilled with it. No idea how well the Dual will perform, though... We'll see... we'll see.