Some sellers really feel they need a certain amount of money from the sale of their home and are thus unwilling to compromise. In some cases they are right, at least from their own point of view. They expect to pay off the home when they sell and they cannot bring money to closing if they take a loss. Not taking care of debt can be a significant blow to some people's self-image. And never underestimate the importance of self-image. Many of us will go to great lengths to maintain our good opinions of ourselves.
In other case, sellers just confuse what is valuable to themselves with what will be valuable to others. They love their homes and they expect others to love the same homes every bit as much. They are not able to see that the home down the street, which is priced considerably lower, is every bit as nice a dwelling.
In still other cases, sellers feel they need bargaining room but don't understand that they are pricing themselves out of the natural market for their residence. And some sellers just think that real estate agents are full of baloney, which we are sometimes.
Whatever the case, I think it is wrong to expect sellers to simply see the light because an agent says the price should be lower. It can take some time and patience and much careful, non-threatening discussion to bring the sellers around. Most people have a good logical streak, so providing good information always helps. But I would never butt heads with a client. Asking a lot of questions about the property and why it should be higher than other well-priced properties probably will do a better job of bringing the seller around to a reasonable price. And sometimes the agent may just have to let the seller learn in the marketplace, which teaches its own lessons, often pretty quickly.