Villa faxed Coventry for the third time with their bid, as Gregory is anxious to resolve the matter in time for the England international to make his debut against Tottenham on Saturday.
But Leeds are also now chasing Dublin's signature with a club-record offer after Coventry's chairman, Bryan Richardson, revealed the 29-year- old has a clause in his contract allowing him to speak to any side who offer more than pounds 5m.
The move could spark a bidding war, with one club being played off against the other as Coventry attempt to approach the pounds 6.75m figure that Blackburn were willing to spend last week, before Dublin turned down the move to Ewood Park.
But a defiant Gregory sees no reason to bid big. He said: "This one is a long way from being over, as there are quite a few other clubs interested in taking Dion Dublin.
"But I don't want to increase our offer. If you go down the local supermarket to buy something with a 30p price tag on it you don't normally offer 45p.
"In the case of Dion Dublin, if he has got a clause in his contract which says he can be sold for pounds 5m, why should we pay more than that?
"There's nothing more I can really do. I'd love it to happen by this weekend and that Dion was our player in time for the Tottenham game - but it's in the hands of the money men."
Coventry, though, are still refusing to give Villa permission to speak to Dublin, despite the apparent watertight nature of the contract clause.
Villa believe the Sky Blues are reluctant to sell the former Manchester United forward to their nearest rivals because of the anger this may provoke among supporters already gearing themselves up for another relegation battle.
This prompted Ridsdale to send a fax to Coventry ahead of Leeds' Uefa Cup second-round tie against Roma on Tuesday, and he is now awaiting a reply.
Ridsdale is determined to back up the promises made to O'Leary when the Irishman took over at Elland Road with hard cash, with the Dublin bid being one of three made for key players in an effort to boost United's small squad. Any fee would shatter the Leeds club record of pounds 4.5m spent in recruiting the former Swedish international Tomas Brolin from Parma three years ago and Lee Sharpe from Manchester United in the summer of 1996.
O'Leary has made no secret of the fact that he wants to inject fresh blood into a side that has struggled in front of goal since he took over, scoring just four times in his seven matches in charge.
Dublin would be an ideal acquisition, although he is believed to favour a cross- Midlands move, as he will have top-of-the-table football without the need to uproot himself from his home near Stratford.
It would mean Leeds being handed a second snub over a striker, after a pounds 2.5m bid for Barnsley's Ashley Ward was rejected last week by the Tykes' chairman, John Dennis, who has slapped a pounds 5m fee on the head of the 27- year-old, now with 11 goals in his last 12 games.
Ridsdale has also tempted Newcastle with another club record offer of about pounds 5m for the former United midfielder David Batty, although the Magpies appear determined not to let the England international leave St James' Park.
Newcastle's manager, Ruud Gullit, has already spelt out his desire for Batty to remain on Tyneside, while it is believed that Leeds would have to increase their bid by at least 50 per cent for the Magpies' chairman, Freddie Shepherd, to entertain the idea of letting the 30-year-old go.
However, Ridsdale remains confident that he will sign at least one of the players. He said: "We have made three offers in the last week and we are awaiting the outcome of bids for two of the three players. Certainly, they would create new club records.
"We believe that the players we are chasing would add value to the squad. They are players the manager wants and I think the fans will be excited if we get two of the three.
"I would be disappointed if one or two do not come off in the next week to 10 days."
The French World Cup player, Stephane Guivarc'h, looks set to complete his move from Newcastle to Rangers tomorrow.
The striker, who has made just two starts for the Tyneside club since his pounds 3.5m move from Auxerre in the summer, is said to have given verbal assurances to the Scottish side that he will put pen to paper.
It is understood that Guivarc'h will watch Rangers in their Uefa Cup game with Bayer Leverkusen at Ibrox tonight before formally completing the switch.
The Greek defender Nikos Dabizas has confirmed that he will miss Newcastle's game against Sheffield Wednesday on 14 November in order to play for his country.
The 25-year-old former Olympiakos player will depart for Greece on 12 November, the day after United meet Blackburn at St James' Park in the Worthington Cup, and will be unavailable for the home game with Danny Wilson's side two days later. Greece take on Albania in a European Championship qualifier in Athens on 18 November.
Blackburn Rovers will have only one recognised striker available against Newcastle at St James' Park in the fourth round of the Worthington Cup next Wednesday.
Chris Sutton yesterday received confirmation of a four-match suspension, that starts after Saturday's Premiership game with Coventry.
Blackburn's new pounds 4m recruit from Bolton, the Welsh international Nathan Blake, is cup-tied, while the Scottish international Kevin Gallacher is still recovering from a broken arm. That leaves the club's record pounds 7.25m signing, Kevin Davies, available up front.
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