The terms being sought were exactly the ones we eventually accepted anyway.
No, they were not.
Japan was still wanting a
status quo ante bellum up until after the bombs. They were trying over and over to get any country they were neutral to propose their own intention of ending the war. And it was not a surrender. They would leave all territory they had conquered after the start of December 1941, and the Allies would do the same thing. The Philippines would remain neutral and demilitarized under a joint US-Japanese leadership, and there would be no war crime trials.
In other words, pretend the war never happened, but still neutralize the Philippines.
Needless to say, not a single country would even agree to present that to the Allied Powers. Even the Soviet Ambassador wrote a letter to Stalin with the proposal, saying that he believed the Japanese leadership was delusional and maybe even insane if they believed that the Soviets would even transmit that, let alone the Allied powers accept it. And Stalin returned directions that the ambassador was to stall the Japanese.
That was only accepted because the leadership realized their entire nation and the Imperial Family was at risk. But prior to 6 August they were unwilling to accept anything other than a reset to 1941. And not even the Swiss, Soviets, or Sweden would forward their demands to the Allied Powers. They all knew the Japanese proposals would never be accepted, and they themselves would lose credibility in the eyes of the Allied Powers for even proposing such a silly proposal.
There was an opportunity to open an actual dialog that might have ended the ear sooner, but once again the Japanese killed it. Literally.
When the Potsdam Declaration was received in Japan, the only response by the government was the famous Mokusatsu speech, by Prime Minister Kantaro Suzuki.
I believe the Joint Proclamation by the three countries is nothing but a rehash of the Cairo Declaration. As for the Government, it does not find any important value in it, and there is no other recourse but to ignore it entirely (mokusatsu) and resolutely fight for the successful conclusion of this war.'
And Japan did exactly that, it was never referred to again. They never changed their attempt to end the war, they never even tried to indicate through anybody they were willing to discuss terms. They continued to act like they were winning the war.