If at first you don't succeed...
... then the late Aaliyah would advise you to dust yourself off and try again.
But how does this work with regard to selling your flip to your end user? If your first buyer is not able to obtain financing (fairly commonplace) yet refuses to sign a cancellation (less common), then what do you need to do to sell the property? Can you simply open escrow (presumably with a different escrow company that has no knowledge of your first escrow) again and close it like there isn't somebody with a claim to the property?
Do you open yourself up to (non-frivolous) litigation by doing this? Is the claim the first buyer has to the property valid? Would the second escrow company have any trouble recording the closing (I'm thinking this would be the case if a Lis Pendens is filed)?
If any of you have previously dealt with this, would be great to hear about your experience.