If we take what you said at face-value, then you answered your own question. Dead is dead. What would happen if you put a bowl of the best, tastiest dog food in front of a dead dog?

If the sod was put down and died before it ever set roots into the soil, then it is a barrier between any seed you apply and the soil. Seed must touch soil to have a chance to germinate and grow properly. If the sod pulls up, then it has to be removed before seeding.

That may not be the answer you were hoping for, and it may exceed your budget plans, but it's the only way to avoid additional wasting of money, time and effort.

Goodness what did i do with that prozac! ok thank you but does't sod have some soil in it ... ? Geeze louise this is a big project!
umm..what other options do i have ..please don't laugh ..i am even considering spraying it green...or if i am done with grass, what would be a cost effective plan like native plants or gravel or chips ? Or even i might just leave it..i dunno

One person's big project is another person's quick honeydo.
One option is to pile up all that sod, wetting it along the way, and let it compost. Then seed the soil underneath.
Another option is to cover the entire yard with chipped wood from a local tree trimmer - the guys who have the noisy machine behind the big boxy truck.
If you start watering it at your last frost date, then you will get something to grow. It might be weeds, but something will come up. The best time to reseed is in the fall, so if you can nurse your yard until August, then you have a shot at something nice for 2015.

+1. Absolutely. Some people see mowing and twice-a-year fertilization of a 2000 sq ft lawn as a huge commitment. I see committing to killing and recreating half an acre (while still maintaining another half acre) as a six-week pet project. It's all about how you view it.

+1 on throwing the dead sod into a pile to be composted.

I'm not crazy about the "leave it until Fall" idea. Nature abhors bare soil and will turn it into a weed farm that will haunt your future projects. Oregon is not a very hot climate - seed a typical "northern mix" lawn onto bare soil when the weather permits, and nurse it to a lawn. The OP isn't looking for an elite show lawn. If it needs a touch of overseeding in September, just do it.

Spraying it green or throwing down mulch will not stop weeds from growing, and are often wastes of time and money. How do you remove all the mulch when you realize it wasn't the right long-term answer?