I'm sorry to read about all of the frustration you've gone through as a result of this failed purchase attempt. All of us in the community of Nagra collectors and appreciators know this particular seller very well - it's a running joke in the FB groups how overpriced and 'RAR' everything is.
He is infamous for his high prices that, as you said, disrupt the market because they distort the reality of the market valuation of the equipment. A would-be seller who may know little to nothing about this type of gear is likely going to first check eBay for price reference. They'll see an inflated price and think - well, its listed for $25k - it must be worth at least half to three quarters of that price. I can't tell you how many times I'll speak with sellers who say "they're going for $xx on ebay." Going for equals Listed For, which is rarely the market-moving sales price. But it really makes it difficult to get a good value for our dollar. With that said, I've seen this done across every product category in recent years.
But that seller who shall not be named has actually made sales at those exorbitant prices. He preys on the guys who get infatuated with these machines from reading about them in forums, seeing people waxing poetic about them in their Facebook posts, or watching YouTube videos. They get a bug up their a$$ to get and just have to have it - at any price. I've been there, so I get it. A guy I know bought a cosmetically mint condition Nagra T Audio without meter bridge or stand for 34k Euro from him. This guy had the funds and just had to have a Nagra T - unfortunately, the machine had not been serviced and needed it badly - it looked good, but didn't run well.
This leads me to another point - he has a track record of lying about what he sells. I have purchased Nagra parts and accessories from him and he was not fully transparent about the condition of the items. Some were fine, but some had cosmetic flaws that he 'failed' to capture in his photos to me. Obviously, the statement about the ISS being New Old Stock is completely fabricated by him and not told to him by the original seller. Additionally, the photos are purposefully taken with lower contrast as to not highlight the cosmetic flaws in what he sells. Finally, he typically lowballs sellers on the buy side - he beat down a person I know to acquire a pristine Nagra D for $1500. He told the seller it was not desirable on the collector market because it's digital, not analog. He later relisted for €12k on eBay. Sounds like your antique dealer acquaintance.