I really think you need to talk to his breeder. Tell her your concerns…find out what she expects of you as far as showing, and breeding, and evaluation of his potential. If you can't get him turned around for showing, which you may not, since he is fearful/dislikes strangers touching him, she may say he is not to be bred. Don't be afraid to talk to her, she will want to know what is going on with him; ESPECIALLY since she either co-owns him, or sold him of a full registration.
We all need to keep in mind that he ISN'T biting at this point. Right? That means he has GOOD bite inhibition. And he is giving a clear warning when he is uncomfortable. This is a good sign, and I wouldn't say that it is necessarily a dog with a BAD temperament for a Basenji. That is what we want in dogs, rather than surpressing their warning signs, and the 'unexpectedly' biting and doing lots of damage.
As has been pointed out in other discussions, it is really hard to diagnose a situation like this online, or/and on the phone. Holly, you will have a chance to meet and talk to a bunch of people at the National, and hopefully we can help you have more insight into what direction to take with him. But, really, your breeder needs to have a large amount of input into your decision, because only she knows how important he might be to her breeding program. But the ultimate decision should come down to you and what you can live with, keeping in mind that he would most likely show fewer signs of aggression if he was neutered.