Do they have a daycare near them? Where they could take him maybe twice a week?
I'll be honest. I ruined Koji. When we brought him home, he was a typical puppy, but more on the calm side. At some point, he turned into a maniac. I can't say what it was from, but I was told the same things also, exercise! Mental games! etc. I did what I could, but nothing really tired him out.
I finally gave in a hired a dog walker twice a week. I was also going home daily to let him out at lunch and give him a quick 15 min walk. Nothing helped. If anything, the dog walker made him more neurotic (anxiety from wanting to see them).
I know now, I should have just spent the money on daycare at least once a week.
I brought home this stable puppy and after a couple of months we were seriously debating on returning him that's how bad it was. I took obedience classes, puppy classes, even started agility for this reason. But by the time we got to that point, he was already a year old and all screwed up by my own hands.
IMHO, if they can't find a way to exercise him (daycare, daily dog walker, etc), and if he is this bad...wait until he gets older and is like this anyways. Koji is a mess, but I'm working on it. He will never be calm outdoors ever again. I ruined that. No behaviorist is going to fix the problem (because I'd have to do it) and unless I work on it daily, it will never get better. I know that. It's just too bad these people don't.
Koji is now 4.5 yo. He's FINALLY settled down more at home. Took only 3 years. He's a nut job outdoors mostly, but we've also continued agility and hubby has been home daily for the past 1.5 years. I think that was our saving grace.
Good luck with this couple. If they truly aren't going to put the effort into it, even if it means hiring a dog walker daily or taking him to daycare, I would really think about lying and taking him back. I screwed Koji up big time within that first year. I suggest you make a decision soon if you can, because the longer you wait, the more this dog will never get over it.
I feel bad for what happened with Koji, but I have never owned a dog like him. Miko really did spoil me completely. He was so easy. I know now how to handle it, but too little too late for Koji.