If you went into a restaurant and were told there was a half hour wait but you saw empty tables would you seat yourself?  

This paired with the losses the town is facing, I am thinking I am better off leaving my earnest money on the table and walking away. 

I have many times seen deals where an agent tells their buying client, you need to beat this dollar amount to win the bid, but never have I seen a deal where they have allowed a seller to leave money on the table.

No tiny houses for me...where the heck would I put my pool table?!  

I have the benefit of right offs,  depreciation and after tax and Hoa there is still 400 -500 on the table.

In other areas like the west side of town you have water table issues, etc.  

If there are several offers on the table and you want to be competitive, well then that's a different story.

Hard to say what they will do, but doubling probably isn't on the table. 

Personally, I didn't sign with anyone, but asked everyone for leads that met my house hunting requirements and offered them the commission if they brought the deal to the table.

Just let them know hotel offer is still on the table, get a hotel lined up so if they take the offer your set.