Your contract governs, generally Section 9, as whatever you signed states the terms you agreed to. The settlement fee is split between buyer and seller in some ratio, whatever you agreed you; absent you having your own settlement agent, ie. attorney.
$1050 overall sounds reasonable though; they run from $500 to $1200 in our area. Losing the deal over a few hundred bucks doesn't sounds like a good proposition at this point.
You also need to get yourself a lawyer as these are legal issues with the contract and not anything a realtor can answer. And start with one next time, not at the end after there are issues that likely cannot be fixed now due to contractual terms.
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