If you are listing FSO, you should still fill out a Property Disclosure Statement, and disclose anything that is currently not working as intended there. I would recommend stating that the crack was found, inspected and repaired, with no further opening up since repair.
Just curious, at which price did you tell your friend's friend was the asking price?

Being upfront and honest is always best in trying to avoid buyer concerns. Not being upfront about it might make the buyer wonder what else you are "hiding."

Ok, thanks, that's what I was thinking. I just didn't know if it was bad to mention things that will come up on inspection in advance. I have started filling out the disclosure form, I just hadn't seen a foundation section yet. Man that thing is long!

I told them 309 for two reasons. First, we haven't had the appraisal yet, and I know it's going to be worse if we want to raise our price than lower it. And second, for less than 300 we'd rather just stay in our house, so I figured 309 gave us a little negotiating room. If they're not interested at that price, I'm fine with that. We reviewed all the comps again and houses in our area with less square footage and fewer bathrooms sold for close to what we want or significantly more, so I don't think we're being unreasonable.

This is my first house to sell and I have to say when someone wanted it suddenly my inner Gollum surfaced. You can't have it, it's minnnnnnneeeee, my preciousssssss.

They never said they wanted it; their friend said they wanted to look at it. Take it one step at a time.

Since the friend contacted me the couple has asked for several rounds of photos and detailed info. Obviously I'm not counting on them coming through, I just want to be thinking ahead since I'm new at all this and want to do it correctly.

Even before you let them in your home, ask them to send you over a pre qualification letter, or a Proof Of Funds Letter to determine if they can even financially perform, and to see where they are in the purchasing process. Their reaction to this request will tell you tons.

Thanks for that tip, I didn't think about that. Here's a related question then -- our friends said they may want to do a walk-through on behalf of their friends (who live in a different state). Should we ask for this kind of documentation before we do even that?

We were still a month out from even officially putting it up for sale so although I've been reading a ton about this I feel a little caught off guard. At the same time, if these people are serious it would be convenient to be able to sell it without going through the trouble of an actual listing.

IMO, you should really be in contact with the potential buyers and not some third party. At least for an initial brief phone call. During that call, ask them where in the purchase timeline they are. Ask them if they have ever been in the town you live in. And then ask them if they have spoken to a lender or will they be a cash buyer.
If they are not buying until late Summer or Fall, then why have their friends tour your home now? It will be sold by then. It could be that their friends are more excited to get their friends close to them then the buyers are about moving there anytime soon. In other words, find out the validity of these buyers. They may be ready, able and willing buyers, or NOT. It is easier to find the NOTS than it is the other.
I just received an email from a prospect in Orange County Ca. asking me to get some very detailed info on a waterfront home here. I know better, so I called him, and lo and behold, they are not retiring until late Summer and will do something then. I explained to him that this home will be long gone by then, but I will definately keep an eye out for him as the time nears.
My point being is that you need to do your homework on these buyers first. Don't feel like you are being nosy. You need to know these thing so you do not waste everyone's time.

Thanks, that's really great advice. I think this is one of the biggest advantages of hiring an agent -- it takes some of the awkward aspects of the transaction and moves them to an uninvolved party. So either I need to suck it up or pay the man!