am i being strung along by potential employer?

Is this private or public sector? If it's public, I can say that all of these things (delays in posting the position, minimum interview requirements, 'open' competition that is not really open) are pretty much the norm. In Canada, at least.

So it sounds like a university. This is well within normal for large public institutions.

I can share two points of anec-data about this. One of the mega-corps that I worked for did, in fact, have a policy that required them to receive a certain number of applications and interview a certain number of applicants for an open position to be filled. I can recall several times when a posted opening had to be pulled and re-posted because they couldn't get enough applicants the first time round. Second point is that I once took a position that was created for me. It took about 8 months all told to make it through three rounds of interviews and HR/Finance red tape even though I was the only applicant. It doesn't sound to me that you're being toyed with. If you really do want the position, I'd suggest gritting my teeth and going to that next interview. Good luck!

HR at some firms is its own separate entity. If they drive the hiring process this way, it probably isn't in your potential bosses interest to burn political capital to circumvent the process if he knows he'll be able to choose whomever he wants anyway. I've actually been given an e-mail offer at one firm, and only then done the HR rigamarole - which basically consisted of a junior HR person filling out the forms for me.

thanks for the helpful feedback all. i do have clouded thinking now! @winnipegdragon -public sector, huge institution

Or, should I just let it go, remain patient, and re-interview without mentioning them? I don't want to appear rude, but I don't want to be a completely desperate pushover, either. Do this, no one will think you're a desparate pushover, they most likely won't think of it at all, and if they do think of it, they will think that you really want the job and will be committed and that will reflect well on you.

i'm almost 30 and this is my first "serious" professional dealing with anything beyond a 75-100 person company! I am so naive about these processes... wow!

At my (large) company, bosses are required to consider internal applicants first. So even if they know they want you, when a job is posted and people apply, they have to go through the internals first and deem them unqualified/not a good fit/whatever before they can hire you. Also: many times the bosses doing the hiring get the rules figured out as they go. Mine used to make definitive statement about how soon a postion would be filled, what a great applicant was interviewed and would be coming in next month, etc., only to have the process drag out over and over again. She's been the boss for 10 years now, and now says things like, "You know, we're going through the process. It looks good, but anything can happen." When she hired her own secretary, she had to wait about 3 months for a start date because HR was insisting on verification of high school graduation from a foreign country. Stick with it, go through the steps, and don't take it personally.

I am at the beginning of this process for a government job. I won't start working for 2 months, at least, and yes, if during the interview process for my job they find someone they really like, then they will put them in the same position that you are in. My guess is that you were interviewing for a job that was created for that "one other person" who was also hired initially. They decided they wanted you too, so they replicated the process.