Welcome to the forum. By coincidence, I believe I have provided additional answers to your questions through the recording I just posted a few minutes ago–before I read your post.
As you can hear from the recording, I have this melodica really talking and have used no effects except delay and the usual EQ/compression used in recording. All the modulations you hear are from playing technique and having the right melodica. The melodica I played in this recording is a plastic Hohner Piano 27. Production was discontinued several years ago, but they are all over Ebay and other auction sites for $30 to $60.
As most people on this forum know, this is one of my favorite melodicas because the sound is projected out the back of the instrument. Hence, you can get all types of volume and tonal modulations from the instrument by moving it around and by pressing the back of the instrument up against your body. This particular melodica bends notes pretty readily. Waving it around a microphone in various ways in combination with using other techniques produces interesting modulations as well. I have been working on these techniques for close to an year. Too much to go into right now, but some of my previous posts talk about this exploration in detail.
So can a melodica (cheap or expensive) be really expressive? Yes, but like the piano, there is a half life of study involved to pull out the instrument’s capability.