First, I'm sorry to hear of your troubles Jen. It sounds like you did your due diligence when you purchased by seeking the assistance of a home inspector and who ever caught the fact that there was no CO on the addition was doing a good job.
I agree that it sounds like the foot valve needs to be replaced. The quote of $5,000 sounds outrageous. I've had very good luck with Dalmik Well Drilling (they service Eastern CT) and if you call them at (800) 922-6220 (Linda or Mike) you can confirm if the original quote was reasonable or not.
Home maintenance items are recurring and something that needs to be expected. I regularly post about homeowner maintenance on my blog ( http://www.gardenrealty.com/MyBlog ) and there's some good info there for you. Unfortunately, most older homes don't have warranties like new homes, so the cost for repairs will likely be yours.
I hope this info helps and best of luck since home ownership should provide you with a more positive experience and pride in ownership.
Greg Hanner, Broker, REALTOR, e-PRO