Calling it off
We're waiting to hear back from the builder, but we're essentially going to cancel the contract on the house. We have had a succession of problems with the house, mostly in that the house we requested in the beginning has slowly veered down a path of the builder's choosing and away from what we wanted.
The biggest problem (as I think I previously posted) was the kitchen layout being designed inadequately to accommodate what we wanted. We ultimately had to give up an additional countertop/cabinet extension we requested because they simply failed to design the room to fit our request. The frustration is compounded by the the amount of time I spent researching kitchen layouts until I found a picture that not only explicitly showed what I wanted, but also would have fit their pre-existing design without too much adjustment.
Essentially we've learned that when building a custom home, you better make sure that all (and I mean ALL) of your preferences are very precisely described and documented in your contract or you will not get them. We had the same issue with the type of flooring (we wanted 5in hand scraped and they only included 3in, so we had to pay more), the outdoor kitchen (we requested a kitchen and showed them a picture of what we wanted, but we didn't get them to print "barbecue grill" specifically, so we had to pay for that ourselves), the size of the back patio (we originally had the home theater pointing towards the back of the property but we changed the alignment by 90 degrees and in the process lost a big chunk of porch space that the builder failed to correct and we ended up having to pay for additional concrete). They were also going to charge us more for lower height carpet in the home theater and bonus rooms although this was in our initial request (but not on the magical contract).
There have been other issues as well and the consistent stance of the builder is that if it's not described specifically in the contract, it wasn't agreed upon and the buyer pays. This despite their promises that we could have all we were requesting in the initial meeting. We learned that those promises are empty if they're not on the contract.
We haven't gotten their response yet, but I'm expecting they're going to withhold any of the upgrades after the contract (home theater bar, concrete, hardwood floors, stone) so we'll probably end up getting only $3-4K of our $11K earnest money.