Unfortunately, I joined and completed the Bards College before entering into the Blue Palace in Solitude. Now when I approach Falk Firebeard the option to do this quest doesn't appear. I want really badly to buy the Proudshire Manor house. Why can't I do this quest? Is there any other way to be able to buy Proudshire? Thanks!

Here is what UESP says: "This may be related to the Bard's College quest, If you have begun the Bard's college quest Varnius Junius may not begin speaking until you have burned the effigy of King Olaf."

Yeah I read up on that. But the problem is that I completed the entire Bards quest before I went to the Blue Palace. There's nothing else to complete there and I still don't have the option.

In other words, I've burned the effigy and it still won't show up.

That's no good then. Not sure what might happen if you just wnet there and cleared the place. You might get the second part of the quest, not sure. Really don't have any syggestions. I guess I would save and go do the quest and see what happens.