I didn't realize your participants wouldn't know they had missed 5. You said "I have an important need that if the student answers 5 questions in a row that are wrong it stops, so they wouldn't have to suffer through the whole quiz." which I took to mean they knew after 5 mistakes in a row that they'd failed and still had to slog through the rest (which is possible if you use adaptive mode, and could be miserable--I don't use adaptive mode, and that's one reason). how would the quiz even know they'd scored the questions wrong if they haven't been submitted? The way quiz works is that they answer the question but until it has been submitted, it isn't set in stone yet, since you aren't using adaptive mode. The participant could answer incorrectly on 1-5, move to 6, reconsider previous answers and then return to change the answers and get them right. It seems like jumping the gun a bit.
Second thing...What is a Lesson? (from moodle docs) "The lesson module presents a series of HTML pages to the student, who is usually asked to make some sort of choice underneath the content area. The choice will send them to a specific page in the Lesson. In a Lesson page's simplest form, the student can select a continue button at the bottom of the page, which will send them to the next page in the Lesson." You build the pages with as much or as little content as you want. You can have content (no question) pages. You can set up clusters of questions which follow a series of content pages. Each page has navigation you decide on. By default, each page jumps to the next. At it's most complex, (for a 4 answer multiple choice example) the page could jump to the next page for a correct answer and one of three separate pages/clusters/branch tables where they get more information or questions based on why they got the question incorrect. You could even set up clusters of subsequent questions where they answer one of several before moving on to check retention of remedial info.
Check out the Moodle Docs for Lesson. I don't know what version you use, so I've set the link for 2.0. It is a bit different than the 1.9 version, from what I hear (haven't tried it out yet)
A Lesson would automatically tell them if they are wrong as soon as they are wrong. It could, however give them feedback and additional information about the topic to improve their understanding. If you wanted, it could send them back to the question to try again after the additional information...It doesn't have an if this section is failed, then kind of logic (to my knowledge) but it does track progress, jump to other (unseen by passing students) pages...
The neat thing here is Lesson gives immediate feedback and supportive instruction, if you build it in. A good lesson takes time to build but provides a lot of extra non-teacher driven student support. They're kind of like the Choose Your Own Adventure novels of the 80's and early 90's, where what happens next depends on how they answer. I've built a couple lessons but usually create them in an authoring SCORM software as I have other needs for my courses. I wish I could do more with lessons (and might have the opportunity soon!)
If your concern is some students are going to fail a whole lot, maybe create a lesson covering the section information (similar questions to the test but not the same) and use it as a study guide. Then they get some practice before they take the quiz. Yes, it adds to initial work load for you, but it might reduce some student stress/frustration and some for you as well.
Sorry for being such a text hog.