I hope you are using an agent for this to represent you, not the listing agent. Short sales can be very difficult and you need an advocate for your interests. And by all means, keep looking no matter what. There is a lot out there and something better can always come along.
Often, the Bank is not dictating the Listing Price; another reason why LISTING PRICES can be all over the board.
If the Homeowner didn't have their Agent do a good CMA, they may not have a good idea of the WORTH of the house. Or maybe they didn't, and then they did.
All you care about is the Market Value of the Home; just ignore their gyrations: Have your Buyer's Agent do a good CMA and see where it comes out: Trust those numbers or you could pay too much, or waste your time trying to pay too little.
Good luck and may God bless
Honestly, I think short sales aren't that great of a deal for precisely this reason. The bank typically will only approve an offer that is reasonably close to it's appraised value. Most listing agent have homes listed at or around it "fair market value." I'm sure there are plenty of other "regular" sales that are a great buy. Don't just focus on these distressed properties. They aren't what they are cracked up to be!
You need to find a good Realtor to work with you as a Buyer's Agent. He/she will help you find the best house, best deal for YOU.