I would say upgrade the TT - and I have heard a Rega P5 with full groove tracer mods.
However, if you want to upgrade the arm as an interim measure, yes the RB880 should make an improvement in precision, timing, etc.
Alternatively have a look at the Audiomods 6 - for similar money its an outstanding arm with VTA on the fly and more saleable as a separate item should you upgrade the TT later. I put one on my Platine Verdier when I sold it and the performance was way above the price point suggested - very good. You can order a Rega fit for the Audiomods - in other words a straight drop in replacement.