If you are talking about the spots on the edge of the seed leaves, I would not be concerned. Your plants look fine to me. Al

Thanks Al.

I had such a high failure rate last year (first time starting seeds) that I am nervous I might kill my plants again.
Damping off was my enemy, that's the reason why I decided to go with non-absorbent pots (styrofoam) and a non organic medium (vermiculite).

I was thinking of spraying the seedlings with some diluted whey from straining yogurt. The idea is to introduce some friendly bacteria, acidity and supposedly proteins present in whey inhibit some fungi growth.

Fungal disease. As long as it is only on the cotyledon (seed) leaves it is not usually fatal but I would spray with a good fungicide soon. Fungal disease is responsible for 90% of the mortality of seedlings. Melons are very prone.

Thanks for your input ifraser. I understand you're not in the states and might not be able to recommend a specific product.
In your opinion, can I use a homemade concaction to address this issue? Plus, I'd rather keep things as natural (organic) as possible.
Thanks again.

I think you may be watering too often. You state that you used non absorbent pots to help fight damping off. But I would think they would have the opposite effect. By not allowing the pots to breathe, moisture would be retained in the mix. I am not totally convinced it is fungal and even if it is I agree with Al that there is no need to be concerned yet. It could just be physical damage from a knock or something when moving them. I would hold off any chemicals or home brewed concoctions, reduce the water and watch carefully. If possible I would try to make a few more holes in the cups too. 2 holes in a plastic container which is getting watered frequently is probably not enough. Also in future I would not set the seedlings so deep in the pots. They end up with a mini humidity retaining wall around them. Fill the pots to the brim and plant the plants at the top. Plants are like people. It is better to keep healthy through an appropriate lifestyle than to live unhealthily and then reach for medicines to reverse the effects.

flora_uk, Thank you for your opinion.

Do you think I should pull them out (plant and soil), put some more soil on the bottom then put them back? That will bring them higher and allow for better air circulation.

I did that with some tomato plants after I realized the peat/vermiculite/mushroom compost might not provide enough nutrients for the hungry tomatoes. The soil I added on the bottom includes homemade compost which seems to be more rich than the store bought mushroom compost in my opinion.

I would just leave them alone. Cut back on the water and watch them carefully. The planting tip was just for future reference. This lot, I think, need some peace ;-) When you start with seeds it's like the first baby. You fret over every sniffle. With subsequent kids you toughen up and they just have to get by on benign neglect. They usually manage OK.

It seems that the black spots are not getting any bigger, so far so good. I'll let you guys know if anything changes.

Thanks again to all of you.