For good pictures of knives, all you really need is up to $40 in materials for a backdrop and some lights. Almost any camera will be adequate, as long as you learn how to use it and take the time to tinker with it. Yes, all other things being equal, a good expensive SLR will take far better pictures than a $100 cheapo subcompact, but for the kinds of pictures you seem to be interested in, the camera is one of the least important elements.
Either find yourself an area to lay out backdrop materials, like a table in the corner, or build yourself a box that you can move around. Then get a piece of nice fabric or construction paper, or wood, or whatever you want your backdrop to be, and figure out what will look nicest. You could even just go buy a piece or two of nice tile or floor stone at the home improvement store to make close in shots on a flat surface.
Then comes the lights. Best are real photo lights, but all you really need is a desklamp with an adjustable neck. Second best to photo lights is a desk lamp with a calibrated photo bulb (daytime for example). Third best is just a desk lamp with an adjustable neck. You will need at least two of these.
Now imagine as you stand in front of your box or backdrop, two clocks. One is vertical, like it's hanging on the wall, and the other is laying on the table. Place one of your lights at about 4 o'clock on the table clock, and lift the bulb so that it's pointing down onto your backdrop at about 2:30 on the wall clock. This is probably the best starting position, adjust to your tastes from here. Use the second light at the back of your backdrop or box as a fill in light, much dimmer than your main light, just to cut the shadows.
Now that you have your lights set up halfway decently, adjust your backdrop until it looks good to you. If you're using fabric, it helps to add some texture; you can put a pillow between the fabric and the box so that the fabric lays on something 3 dimensional, and then ruffle the fabric so that it has some folds and texture. Paper is usually best with no texture or seams; try to curve the paper from vertical to horizontal so that there is no seam behind what you will be photographing.
And then just screw around with your camera on a tripod. Look through the viewfinder or on the back screen to see what looks best with light and shadow, texture or color on the backdrop, etc.
Shoot your photos at an angle different from your light. In other words, if your light is set at horizontal 3, try shooting at 7 to get some shadow detail. If you want to shoot pictures on a flat surface like a tile, don't point straight down, do it diagonally, like 1:30 or 2:00. (Maybe I should just say 45 degrees....meh)
I know I rambled a little, I'm a bit lazy to type up a true introduction ATM, but I'm sure somebody will point you to one.
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