I had one of these prior to grad school that I used for traveling gigs. Overall, mine was a very sturdy flute. However, it was limiting. I purchased a different headjoint (from another maker) that helped some. The H1 headjoint was terrible, very stuffy, for me. I just could never get any kind of color variation to the sound. It was also somewhat "clunky" for lack of a better word. In the end, it served its purpose. I wouldn't say the KGM is a souped up 3SB (I have compared), but there really is not much of a difference in sound and feel. Later on, I had a student who came to me with a KGM and had a lot of mechanical issues. She ended up sending two of them back to the factory before she got one that was decent. She finally ended up selling it and buying another flute of the same level to get her through high school.
Also, I bought mine when they first came out and only paid a little over $1,200 for it new. I am not sure I would be willing to pay much more than that, especially considering you can get a Muramatsu EX, for example, for around $3,500. Overall, the EX, even though it is not solid silver, is a better flute in my opinion. There are others, I am just partial to the EX

If this is beyond your price range, I would recommend also looking at Pearl and Yamaha. I have had students with MUCH better luck on both than the Gemeinhardts.
A lot of times, students will look only at the specs when buying a flute. Truth is, you have to try them out and compare. Some flutes look much better on paper than they play.