Am I being OCD/too demanding, or is the painter lazy?
I have been painting for 20+ yrs and as soon as a home owner wants to talk or do a walk thru I meet with them to go over what ever their concerns are. Any contractor you are not happy with you have every right to hold the final payment weather it's 10% or 90%, we are here to make your home look amazing. As the home owner you have ever right to stop the workers from working if your not happy with the job they are doing, you have every right to be upset, painting is expensive.
I agree with some posters that your home may contain lead paint which should have been tested.
Any contractor who threatens to sue a home owner over final payments does not know the laws regardless of what the contracts states. It is you home you are paying for a professional painting job not a high school hack job.
I feel bad this happened to you. We have tons of shady painting contractors around here that simple stiff the home owners then threaten to sue if not paid in full. 90% of the time the home owner wins in court.
Do not let this experience ruin it for you if you need more painting done im the future, you know what just happened and will know what to do if it ever happens again.
His wording about you not bad mouthing his company, don't bad mouth him, just say if any one asks you who did your painting explain what happened, what you tried to do to make it perfect and simple say call this other company instead.
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