Seriphyn, that mission is just badly worded.
The counter offer is assumably done so that your mission is either updated or replaced with a new mission with two alternative goals. The first one is the original mission. The second one is the new mission. You can choose to complete either one, even is the title (e.g. "Sabotage") always belongs to the alternative goal. And yes, your progress that far is wiped.
To play safe with pirates, stick to RES or nav beacons. To play safe with traders, stick to nav beacons, "seeking goods" ("seeking luxuries", etc.) beacons, or stations. Do note that there is an extra fine for firing within no-fire zone, and if you hit a non-wanted target there, the station will attack you. Large stations will zap you, but outpost defenses are assumably made up of janitors with flashlights, so it's quite viable to fight around an outpost.
Or then first do rounds in unidentified signature sources until you find the counteroffer and then start killing. I understand some people have used this with the background simulation fiddling, accepting missions from a faction they want to bring down and wait for the alternative mission.