Your questions are good but no you do not need a Title V to purchase a home. You may not get it financed. And the cost to tie into sewer if available or to replace a septic system can be very costly.
I would contact a Good Real Estate attorney. Also he may want to look into ch 93A
And, we are naturally talking about; In Writing!
The Listing Agent did not LIVE in the house, and if they filled out a DISCLOSURE form, it probably would not include this.
The SELLER would be responsible for this piece of information, not the Agent.
The Seller would probably be protected by the "best of your knowledge" thing; meaning that they could make a mistake.
Also, to sue them, you would probably have to prove a "LOSS"; a financial loss due to the mis-representation. Gonna be hard to prove or put a $$ value on.
Having had a Septic System, I would say that it is a toss-up, which is better; you won't have a monthly bill for sewer and you may go years without doing anything to the Septic.
I'll just wish you good luck, whatever you do.