I think the impact of different woods on the sound/tone of guitars goes far beyond the difference between hard and soft woods of differing densities. In any case, it's clear that a guitar's wood or combination of woods often makes up the bulk of the instrument's price.

I'd like to see further discussion about the use of different woods. In the meantime, check out these web pages;

Guitar Wood Types & Tones http://www.jemsite.com/jem/wood.htm

Guitar Woods (discusses four different spruces along with other woods) http://www.hoffmanguitars.com/woods.htm

Tone Woods http://www.ultimate-guitar.com/columns/the_guide_to/ultimate_guitar_guide_tone_woods.html

Guide to Different Electric Guitars and Their Tones http://www.ultimate-guitar.com/columns/the_guide_to/guide_to_different_electric_guitars_and_their_tones.html

Then, of course, there are some fine/expensive guitars that are not made of wood... ;)