With what you have described, I would have to seriously question whether or not she really wants to sell her home. Separation anxiety becomes real when people are faced with making a change that they haven't full accepted.
If this is the case, you could very well be "spinning your wheels" with this listing and going no where. She's clearly running you around. Each time you get close, she gets in the way of progress. Unless this can be resolved to your satisfaction, it may be time to consider "pulling the plug " on this one. The reality is that there are some listings that just aren't having. Your time has value that clearly isn't appreciated.
She's not operating in good faith (based on your entire story), but she's within her rights to turn down those offers.
The problem is that she's changed her mind about selling. I'm not sure why; she blew it with the offers in June and then essentially salvaged the situation after the price increase. But step back a moment. She's no longer interested in selling.
Or--hate to raise this possibility--with all the offers in June and even the more recent offers--maybe she thinks she can do it herself. ("Gosh, multiple offers 14% over listing price. Then another good offer even after I raised my price. It can't be all that hard. I think I'll just wait until my listing expires, do it myself, and save x% in commission.")
You need to have a heart-to-heart talk with her and try to figure out what the problem is.
Hope that helps.
I don't think this is a matter of 'good faith' or breach of contract. We've all experienced unrealistic sellers. Your only decision is whether you want to keep working with her or walk away at the end of the listing period.
As time goes on she's only going to get less offers and she'll either accept market reality or not sell her house it's that simple. Sellers don't ever set price, nor do agents, market price will only ever be set by ready willing and able buyers. Sellers and Realtors who don't understand this most basic premise are delusional. Now Sellers have the prerogative not to accept any price they don't like and to keep their home, When I meet sellers like this I do myself a favor and simply wish them the best of luck and walk away. Your seller definitely sounds like she's delusional. If I understand you correctly she had an inspection done, agreed the house needed work then raised her price and now refuses to bargain.
You've got two simple choices as I see it; hang in there and hope she comes to her senses or walk away from the listing.
As others pointed out she's not breaching her contract, but she's definitely shooting herself in the foot. and I'm willing to bet money she'll regret not having taken the offer that was $500 below her asking price and will ultimately sell the house at a greater discount than $500. I've seen this story countless times over the 23 plus years I've been a Broker; and have never once seen a seller come out ahead.
From your brief description, I might guess that your homeseller is feeling that the original price was under market and now she's trying to adjust that. It also sounds like you and her are on different pages of the 'negotiation handbook'. Her strategy is not what your strategy is. I think it's time to sit down and listen to her, possibly review the repairs required and what value they might add to the sale price if she did them.... Whatever she decides is what your instructions are, whether you agree or not.
And if she decides to sell without doing the repairs, the term that best attracts the buyer who will complete this contract might be that the home is a fixer. It's a definition, not an opinion. Does she have a better term she wants to use to find the right buyer?
And last, if you really don't see eye to eye, it might be time to dissolve your agency relationship. Sorry to say, but sometimes the realtor/seller relationship just isn't a good match. That's up to you to decide. Good luck!