Well here is my thought.
Completely divorce / compartmentalize the sunk costs. They are gone, forget about it.
So what you are looking at now is a 1-2 year old manual transmission sport wagon with low miles, a long warranty, low cost of operation, and good MPG for $12k that you know has been well maintained and driven nicely. That's not bad.
I personally would not trade that for an unknown quantity car for 7-8k with 100k miles. I've bought cars similar to that with clean Carfaxes and found out later they had damage. Or had been detailed very well but with smoke and other odors that came out later, etc.
The Fit you found isn't a bad car BUT it is a different car. I believe they get about the same MPG as your GT but I believe the Fit is also quite a bit smaller. Not that that's bad, but for my own situation I wouldn't trade down unless there was a compelling reason (major cost savings, easier parking in a big city, etc.).
Since you have no current way to eliminate the commute, and the savings on downgrading to the higher mileage car is moderate at best, I'd stick with it. Again, that is just my thought. If you do not work on your own cars that further bolsters my position as you'll need to allocate 2-3x in estimated parts costs to cover labor for repairs on a used vehicle.
Now on to your balance transfer question, I wouldn't do it. I'd throw ALL the money I could possibly spare at the student loan unless it is a very low rate and your money could best be used elsewhere. That's not to say that balance transfers are bad but I'm assuming your student loan is much higher than your car loan.
One other thing to think about, 12-14k might be hard to get for your car. Manual transmission wagons are used car lot lepers. I recently passed on a 2014 Fiesta, loaded, with 18k miles and a manual transmission for $11.5k (still thinking on that one). They were practically begging me to take it. I see you only getting offered maybe $10k by Carmax but that's just my thought.