I would definitely not let the town into your property! Many homes are not up to code yet are definitely able to be sold.
A seller's inspection may be useful but may be overkill. Some inspectors may empasize some items while other will consider them minor. In addition, one buyer may make a big deal out of something and another buyer will overlook the same item. It may seem prudent to preemptively fix everything but I think it is overkill. Let the buyer get their own inspection. They won't trust your inspector anyway. Once they raise an issue, then you can address it individually.
I think it depends on what part of the country you live in as to whether they are typically seen as an asset or not. Here in PA they are not frequently referred by Realtors. The objections I most frequently hear are that they can increase the seller's liability with respect to disclosing items. This can happen when a seller is made aware of issues they did not know about before and are not prepared to fix.
The second concern is that the buyer's inspector will uncover things the seller's inspector did not. This happens fairly frequently, many times because inspectors all have areas of expertise or strengths. The buyer's inspector may have been a master electrician and identify a few items that only his trained eye would catch. The seller can pay to repair several items believing his home to be perfect, and then be dismayed when more items are turned up by the buyer's inspector. This can leave a seller to wonder why they paid to fix those few items, or even why they paid the first inspector to begin with.
It can be a great marketing tool for sellers. It can, as many suggest, help prepare a seller for the buyer's inspection, and also help the sale price hold up. So, there are many advantages. But just to give a full picture, I thought I would share some cons, too.
Of course, as an inspector, I wish EVERY seller had a pre-listing inspection so I could be twice as busy!
As an inspector, I can tell you that most township inspections are not really full code inspections and many are nothing more than a check for handrails, smoke detectors and GFCI outlets. Some are pretty tough, but around here, they are the exceptions, not the rule.
The buyer's inspector will likely uncover more issues that you will also need to address. If a local inspection (often called a "Use and Occupancy" or something like that) is required, the items that inspctor uncovers MUST be addressed in order to transfer the property. Many of these items will be duplicates of the buyer's inspector's findings.
So, let the buyer have at it first.
If I were you I would let the buyer get an inspection on your home first only because they are going to get one regardless or should I say 9 times out of 10. Depending on the inspector they choose they may or may not find any significant repairs that need to be done on the home which would save you the inspection costs. If there ARE known issues that another inspector will find then it would probably be in your best interest to get the inspection done so that you know how much it would cost to repair. Doing this will make you certain that you are not giving a buyer a higher credit for repairs than is actually needed.
Hope this helps!