Complex sentence: Fender recognized the potential for an electric guitar that was easy to hold, easy to tune, and easy to play, and would not feed back at dance hall volumes as the typical arch top would.
Split into simpler sentences: Fender recognized the potential for an electric guitar that was easy to hold, easy to tune, and easy to play. He also recognized that players needed guitars that would not feed back at dance hall volumes as the typical arch top would.