Is the parents' rejection of the girl whom the suitor wishes to marry, and their preference for another, after performing the Istikhara prayer, a sign that marrying her is not good for him?

The family's preference for another girl does not mean abandoning marriage in general, or abandoning marriage to the girl the questioner has chosen. The one seeking guidance (through Istikhara) should proceed with the matter for which he sought guidance. If he finds ease and facilitation, it is a sign of divine accord. If he finds difficulty and hardship, he should turn away from it. If confusion persists, he should repeat the Istikhara until his heart is set at ease with what Allah has decreed.