I guess this really highlights the problem with the whole bureaucracy in general, and that contract in particular. You know what "IP transfer" means. OP doesn't. And, I'm convinced, he doesn't have to. He is not a lawyer, he knows other things, that lawyers do no know. Cheers to you for knowing both lisp and law, but I really cannot judge OP for the fact he knows only lisp. I believe it's not him, who is guilty, but the system, where every harmless lisper can be forced into signing contract he doesn't understand because of the fact he wanted to do something good for the society (and paid 20 bucks for that, by the way).
Yes, I suspect so, and it is pointed out in the comments several times already anyway. But this is another thing that some harmless lisper might not know, so he will discover it at some point that is much closer to the court, after spending quite a generous amount of money on the lawyer to defend him. And, considering how fucked up legal system is, it is not completely unlikely that he will actually need this defend, because Detroit's lawyers will be trying to prove that there actually was something in that contract for the OP, and it is "consideration enough".
And even if nothing bad will actually happen — which might be true in this case, but not in general — you can say that moral damage is already received. And nobody will ever pay him for that, because, guess what, he is a harmless lisper and not somebody, who tries to sue everybody he sees for the moral damage.
That surprises me. IP transfer means you would no longer be able to use your own code without their permission. That would be a show-stopper for me.