I would say definitely stick with the arm, nothing wrong with it ! I have a 1210 mk2 rewired and that totally transformed what was a dark and closed in sound, and the new arms are a step above what they used to be like on the old 1200 series, and so it should be for the money !
Cart wise i would say try a few top flight MM carts to try alongside your 2M black and see if you prefer the presentation of either. Sometimes throwing money at something is not the answer if the synergy is not right. I am thinking the AT740ML and Nag MP500 here for different flavours. My personal fave would be for the AT 740 or the more expensive 760SLC. I don't think that the 750 Shibata is any better than the microline, its just different.
Then if you liked the sound of the AT but wanted a genuine step up then the ART 9 is a whole lot of cart for just over a grand new. That would show what your 1200G is capable of IMHO.