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Um Amar, you absolutely take that money. I can't believe they offered you that much, but take the money and RUN. If you really want the car, tell them so, and they'll give you the car AND payment, less the amount that they could have salvaged for (at least they'll do this in California - perhaps the GWN is different, but I'm betting in Canada they're even MORE reasonable).
As a general rule, don't let emotions rule business deals - and since this is about money, and doesn't involve a relative/friend/human being (i.e. losing your friend's car in a pond, and then offering him $50) it is a business deal.
Best of luck however it works out!
Lanval
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