Short sales rarely close on time. But, once the bank decides to close, you'd better be ready! Just one of the joys of short sales.
Hopefully, in your contract or in your attorney review period, your attorney put a date in whereby if the bank has not accepted your offer and set the closing date you can pull out of the transaction and get your money back.
If neither your agent nor your attorney protected you in that matter, you should find new ones to work with should you decide to pursue another short sale.
As far as what you can and can't do, only your attorney can advise you. If there is no provision, you are probably stuck and at the mercy of the bank until they set the closing date--which could be months from now! If you breach the contract, you could possibly lose your down payment. Something only your attorney knows.