Inspectors recommending contractors
I'm a city inspector and I find that INCREDIBLY UNETHICAL. I don't even like to take a bottle of water from a builder on a hot day because I don't like for there even to be a remote possibility of conflict of interest. I often get calls from residents asking for recommendations. I don't give them, but will let people know if the contractor they're asking about does good work in my opinion or not. I have to be very careful not to slander anyone or recommend anyone.
Christmas can be very complicated as well...Many builders will want to give food or gifts to the inspector (most out of the goodness of their hearts), and we have to be very careful with how that can be perceived.
You're certainly not obligated to follow their "recommendation". If it becomes an issue, I assure you that a call to the mayor, council or city manager's office will put a quick stop to it.