Questions on handling an accident FIR case

I was involved in an accident with the 2-wheeler coming from the wrong side. After giving appropriate first-aid, they demanded tons of money from me. I refused and asked for police to be called. They refused and I thought the matter was settled as they weren't ready to take it forward. Now 20 days later I came to know that was a huge mistake. Those guys went to police station and registered a case against unknown person. Their version is somewhat strange as they claim that a car hit them and they were taken to hospital in the same car. But, the person taking them to hospital was not the person driving the car instead it was other nearby people. So, the police called me to come down to Traffic PS 30 minutes along with license. When I asked what needs to be done, they gave me options. I tried to get as much information as possible for my options: 1. FIR can be cancelled - My understanding is that FIR once registered cannot be cancelled. Though when I look up the FIR number on ecourts site (https://services.ecourts.gov.in/ecourtindia/cases/fir1.php?state=D&state_cd=3&dist_cd=20) and lookup the case status by FIR number it doesn't show anything. There I can see a box which says "Blue colored text indicates Un-Registered Cases". Does it mean the case is not registered at all and this can be cleared away? 2. Settle with the other party - There is 279 and 337 applied on the FIR. While 337 is compoundable, 279 is not. So, how will this work? Currently, I am confused about my options and need advice on how to proceed. Please help.