What would you do?

Good morning!
I have a tiny situation with the purchase of my 2 year old. Let me break it down.

April 2012, I went to a ranch referred by a good friend to look at some sale horses, already had my eye on possibly two 1.5 year olds. I had a laundry list of the exact horse I was wanting.
My list;
Registered(or able) AQHA
Mare
Under the age of 6yrs
Colored - Buckskin, Dun(anything) or Palomino
And of course sound and healthy

Got out to the ranch met the owners and made a nice connection with everyone. Very nice people. The gentleman started showing me around and there were horses everywhere. We walked by a couple stalls and a little palomino instantly caught my eye at the same time he was explaining to me that all the horses down the far right were his sale horses (palomino not in that area of course). I figured the palomino was a gelding anyway lol, my luck anyway, plus not on the sale side.
I made my way down the sale side while the gentleman went back to doing his own thing. I liked a few but couldn't stop thinking of the palomino, so I made my way back up to it and realized she was a mare! She was in with another young paint mare. The gentleman made his way back over noticing I was checking out the palomino. I politely stated that I knew I wasn't on the sale side any more but had to check her out lol. Which in turn he said that she was indeed for sale but just got her the week before from Bakersfield CA and just hasn't touched her yet, therefore she just wasn't listed for sale yet, but if I wanted her I could have her.
Her details; Born February 2010, from Bakersfield CA with a breeders report on the way, pending registration. (Probably where I went wrong here).
Asking price $3,500 BUT payments allowed, great for me because I wasn't prepared to chunk that amount out this quick.
Deal was; I am to pay $500 down and can take her. Then $200 a month until paid in full. I am to receive the breeders report as soon as they received it from their seller from Bakersfield CA.
I have been good on my end but have not yet received the promised breeders report. I ask monthly for it with every payment I send and get some excuse. The first excuse was the owner the purchased her from died and the family is trying to pick up the pieces. So I wait a few months and ask again if they've heard anything and get another excuse that the deceased family is fighting among themselves and they haven't heard anything. Now when I ask about it they haven't responded but they can contact me to tell me they've changed addresses.
So with keeping my end of the deal, I have paid a total of $1,500 for her thus far. Owing them $2,000 still. On a horse sale for her UNpapered and NOT broke would be no more than $1,500 in my area, in fact $1,500 would be the very high end. Granted, to me she is priceless but we are talking business and reality here.
I signed an agreement for her at $3,500 with the monthly payments but that same agreement stated registrable for AQHA with pending breeders report.
My thoughts and idea, since they can't respond to my inquiry for the promised breeders report, I will just stop payments until said breeder's report is produced. I feel I have paid her worth in reality. If said breeders report is delivered I will be more than happy to continue on with agreed payments and pay the full price.
What would you do?
Sorry for such a lengthy post, felt to explain as much as possible.

You can't just stop paying. If they're not keeping up their end of the bargain, return the horse and get a refund. You don't get to make an arbitrary decision about how much she's worth.

Figured I would get that exact answer. Only because I thought the same thing. Thank you for your response.
The responsible and good person I am, always avoid confrontation and conflict as much as possible, therefore, have been continuing payments. Just wrote this post to seek advice of what others would do.
As I also said, she is priceless to me, I know I will end up forking out the full amount just very reluctantly merely for my own stupidity for taking someone's word that I hardly knew. Also where I stated, "(Probably where I went wrong.)"

Stopping payment until said breeder's report was produced was just "my thoughts and idea" out of pure frustration for their lack of response to any of my messages or attempts of contact. Not that I can actually bring myself to do so from just always being the push over and sucker.

But again, thank you for your response. Something I have already had thoughts about and decided against because of how much she already means to me. PLUS all the training and work I have put into her.

I wouldn't stop paying for her, but I would let the seller know that the signed contract was for a registrable horse and that is what the agreed price of $3500 reflects. If they are not able to produce the breeders report so she can be registered then I would ask for a reduction in price. If they say no to both take them to court.

I agree with lady godiva's response that is the most responsible way with dealing with this issue.
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Just as an FYI, if her previous owners are indeed dealing with an estate now and there are problems at the estate end, it can drag out for ages. I go with what the others have said - pay for her and then duke it out in court.

I really appreciate the responses, thank you. It's frustrating at times not being able to vent or talk about issues as such especially with non horse owners.

Is there any way you can contact her original sellers direct?
Did she not come to you with a Coggins or any other sort of vaccination records with their address on that you could do some detective work and trace her back
Its funny - there was a thread yesterday that got really contentious where the OP posted a not very good Craigslist ad for a palomino AQHA type mare located in Bakersfield and someone even suggested that maybe it was being sold by a relative of someone who'd died as the person who had placed the ad was very not a horse person but the mare was in very good condition!!!
She was also in foal.

Jaydee that one wasnt palomino but I agree with everyone else if they arent contacting you savr all your emails and such and take them to court.
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Jaydee, unfortunately I have nothing to go on. I have been advised to do a DNA test for hopes that either of her parents have been DNA typed and go from there, which I am highly considering.
I was told (not too sure I can or will believe it) but she is a granddaughter of Shining Spark. Either way, I am just more curious as to her ancestry more than anything. What she was bred for and such.