As mentioned, there seems to be a divide between the more recent 4AD albums and the earlier material, a divide that oversimplistically can be classified as: Early= lofi+solo guitar; Later=better quality recordings, bigger band.
There are certainly exceptions in the earlier material but the important thing is the songwriting quality and voice is there pretty much from the get-go.
I'd actually recommend Zopilote Machine. I believe I first read about the band in a zine (!) where the writer wrote glowing reviews about a bunch of the singles and/or cassette (!!) releases. I think I later saw this album listed in Spin or Rolling Stone's "Best Album You Did Not Hear" list and then I tracked it down, to much delight.
A couple of other recommendations.
The non-official band site,
http://www.themountaingoats.net/ , offers a good sampling of some rare songs. It also links to live shows hosted at the Live Music Archive,
http://www.archive.org/details/MountainGoats .
As discussed here,
http://www.friendsoftom.com/forum/index.php/topic,1908.0.html , the Live Music Archive is a great resource for live shows with a lot of artists a la Phil Lesh and moe. but also the Mountain Goats, the Mekons, Godspeed You Black Emperor, Man or Astroman, Acid Mothers Temple, Spoon, Low, Minutemen and more.
