Thanks for the comments. I really appreciate the advice.
I'm using a Lewitt dynamic mic and I had the option of putting reverb on the vocals but didn't in the end because I felt the sound was muffled too. I used three different channels (supposedly) but the vocals and guitar were coming from one speaker. I have limited options since it's a fairly basic PA (Yamaha stagepas 300).
I also think the acoustics in the room aren't helping. I might do another song in a smaller space to get a more compact sound. In saying that, I'm no expert on acoustics.
And if you like the song, maybe you can try a version yourself - it would be interesting to see what you'd with it.