Agreed, both clubs have set a price. However, our price is forced and below his true value to us. If we really had the option of him seeing out his contract for four years, his value on the pitch would probably outweigh the lost transfer fee. The reality is we can't sign a player of Modric's quality at his peak so in that sense he is irreplaceable to us.
In contrast, the Madrid price is below a true market price. Madrid know they can usually get the players they want and know they have other options. They also know players want to move to them and can use it to bully the selling clubs. So while both clubs have set a price, its not a free market price. We, of course, use our status to get players from other clubs in a similar manner.
If we don't come to an agreement, it will because we value Modric more. In a sensible world, he should be upset with Madrid for not valuing him enough. Its hardly our fault if Madrid think they have better options at that price. Unfortunately it doesn't work that way and would be harder for Modric to play full-heartedly for us next season even if he was trying to.
P.S. On the blame game, Modric is responsible for his actions and a willing participant. No one is forcing him to be unprofessional and break his contract. The agent, though, will have played a big role in determining the tactics, probably with help from Real Madrid.
