Agent's Parents Want to Buy

You've had five months to find out if the buying public is ready to pay the price you've been asking, and nobody was.  So I don't think you need be suspicious about these particular buyers holding off till your price came down.  It sounds as if nobody else is ready to buy anyhow, and that's after newspaper ads and flyers.  The request for what are known as "seller concessions", that $7,500, is not out of line either, as long as it's made clear to the buyers' lending institution with no fake contract involved.  And the fact that the agent disclosed the identity of the buyers is also as it should be.

But you are right in thinking that there's a possiblity of double agency, divided loyalty, involved here.  You might want to talk with the managing broker in that office about the problem.  By all means, get your own attorney involved in the transaction. 

Actually, the one thing that bothers me here is the contingency.  Before tying the house up in a contract, I'd want to know about the buyer's current house, whether they'll price it at a no-nonsense level for prompt action.  And I'd want the right to call them on it if I want to accept another offer -- give them three days to decide whether to remove the contingency or drop out so I could accept the other offer.  I'd want that escape clause from the beginning, not after 60 days.