I can sense your frustration, but keep the "faith" if you will, so many of these deals fall through who knows how this deal will end. I hope things workout great with your purchase. There are some great deals out there and you chose a GREAT time to buy! Best wishes!
The rule of thumb on foreclosures today is that if the house is priced well you make a strong offer because there are so many buyers out there that well-priced listings are getting 2, 5, 10, 15+ offers. Some REO listing agents do a great job with customer service, others do not. You shouldn't rely on them going the extra step for you when placing offers because you might be disappointed, as seems to be the case here.
At the same time, if you were the seller and you had one offer come in but they said: "if another offer comes in we'll increase our offer" and then a stronger offer comes in second but they don't make such a statement, you might tend to think that the 2nd buyer is more serious with their offer because they came in stronger to begin with.