The word 'classic' has lost whatever original meaning it had through being overused, much like the word 'liberal', and now 'socialist'. 'Socialist' today means 'anything I don't like'.
The real meaning of 'classic' is 'ancient'. The Iliad and The Odyssey are classics in the original sense. Steinbeck's works, written less than a century ago, are considered classics today. They are really good, though. But it's just a matter of time before Danielle Steele is seen as 'classic'. 8^O
What to read? Well when I was a kid I read everything I could find by Mark Twain (a lot!) and Charles Dickens. I still think Mark Twain is a hoot, but Dickens, well I think I just had too much time on my hands (but I still think David Copperfield is one of the best novels I ever read--the great characters, the sweep of time and all that). I read Moby Dick when I was eleven and it just lit up my imagination.