A lot depends on the listing agreement and the information that was provided to them from the seller. As to weither or not they can raise the price, yes they can. Since it is a short sale, they may have found out that the bank would not accept the offering price.
When writing an offer it is always a good idea for the buyerâ€™s agent to look up the history of the home and also the facts on the owner and the loan amount that is on the home so that they can help you determine if in fact the offer may or may not go through.
If the agent pulls the assessors data on the property they should know at that time (the time when you are writing the offer) if the home is in foreclosure and if it might be a short sale. Unfortunately not all agents do that when writing an offer and some fail to do it when they take a listing.
Your recourse, if you think you have been wronged would be to notify the DRE your agent can give you the information. I don't know if it would be worth all of the negative energy but the choice is yours. If you want to hold them to the price that it was orginally listed, you cann't.