CA says OC will not PFD

I have a line of credit (2nd mortgage) that is bad debt/collection but not sold off.  CA contacted me negotiating to settle.  We came to agreement of settlement, but I request that would PFD.  CA said under Fair Credit Act Reporting that they will not modify settlement other then change status as settle for less.  I even asked if they would delete any damaging inquiries the CA and OC pulled on my credit, and they refuse to.  I know that I can possibly get a statisfactory in payment so they won’t come after me later.  But, should I press CA to remove damaging inquiries or a better reporting status?

 

Will my FICO increase if I get a settle for less status?