Do I need a real estate agent to buy a house in California?

[foreverme]

Our realtor is a family friend whom told us she would help us buy a house and would not take any comission; instead use her commission to help us with closing costs. A year later we are still on the hunt and now she says she may use some of it to help us depending on what the commission is. She hasn't been telling us she's found any houses; we are the ones who finds them and sends them to her. We've put in a few offers but have not won any. She originally told us we only needed $500 for a deposit, but $1000 would look great! So, we saved $1000 for the deposit and wrote her a check for proof. Now she is saying we are losing the offers because we don't have a big enough deposit and that all her clients put down at least $5000. I told a friend about this and she says it's not right. I don't know much about house buying so is this right? Do we need more of a deposit? We're about had enough of her and am ready to go with someone else. But I'm wondering if we need a real estate agent at all? If we do not use one, would we get the commission to use towards closing costs? We don't have any money saved really, except for the $1000 and just need to know what is the best way to go about buying a house. In the mean time we are trying to save as much as we could but with car troubles, holidays, coming up etc..it's been very difficult to save anything. Thank you for your answers in advance!