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the fork is another issue. it's going to do nothing for absorbing bumps whereas a good steel fork with curved fork blades or a carbon fork improves the ride of a bike a lot, especially on rough surfaces. It's going to be quite a harsh ride. The freewheel not a cassette is pretty shitty. No QR on the rear and carrying a spanner kinda sucks.
You can ride any bike anywhere and even pure road bikes are fun for gravel. It's easy to pick flaws with a cheap bike but always remember just how 'bad' by modern standards bikes used to be, and they were ridden on some truly dreadful roads. That bike has wide clearance and that's a big plus. If your plan is to upgrade everything then maybe spend a bit more initially and get something with a cassette wheel, and wider gearing, but i think you'd probably have fun even on this. If you don't have a used market it's not a bad idea i guess. First upgrade should be brake pads, and first thing to do should be adjusting the hubs and truing the wheels, pay a shop to do it or make sure the shop you buy it from does it if you can't. The wheels are by far the thing most likely to break if you take it offroad. Run as wide tires as you can to lessen the chance of that happening.
