I've decided to walk away from the house contract. The sellers agreed to fix everything, but given the problems, I'm just not convinced. In fact, I'm convinced that there are other problems hiding in the walls, based on some of the things that came up. It's a rehabbed house, and some of the work was not done correctly, which makes me wonder what other work hasn't been done correctly that we're not seeing.
There were some other issues that came up as well, and it just made me realize that this isn't the house for me. So back to looking. It's a little disappointing, but also good. I'm only out a few hundred dollars for the inspector (money that was definitely well spent).
The down side is that I had a sweet interest rate locked in. But it's not worth it if the place ends up being a money pit, right?