Merlot can be the basis for excellent wine (see: Petrus). However, I think California generally produces mediocre merlot. California's strengths are Cabernet (Sauvignon and Franc) and Zinfandel. For Pinot Noir, there are a couple spots like the Russian River Valley that do a good job, but Oregon has a stronger claim.
In the US, you kind of need to know what varietals grow well in what regions. In Europe, they typically produce varietal blends that are optimized for the region where they are produced, but which have very different characteristics depending on the region. I prefer the European model of branding on the region rather than the varietal, because the wine experience is more consistent and predictable. You know it will usually be an appropriate varietal for the region in which it is produced. That is not always the case in the US; we seem to grow any varietal anywhere if we think we can sell it.
That said, if you want to look smart about wine without spending a ton of money, the best choice is something from a region relatively few people have heard of, and therefore inexpensive, that nonetheless produces brilliant wine. Sommeliers often appreciate people that can identify those hidden gems on the list because people trying to be flashy don't even recognize them. Of course, you learn this by drinking wine from literally everywhere, and especially places you've never heard of, until you form an opinion. Availability varies widely with geography but in 2021, with the globalization of wine, there is little reason to spend much more than $10-20 bottle (retail, not restaurant) for almost any style if you know your regions and quality is the sole objective (local availability notwithstanding).
But then, I'm just a random wine drinker on the Internet. :-)