I'm trying to get the details of the lawsuit to see if there's a chance the suit can come to me, but the landlord is dragging her feet and asking me to give her any support material I may have.

. * serious harm caused by encroaching tree limbs or tree root may give rise to a lawsuit.

It took a while to get the first property, but I am currently working on an H House (3 bed 1 bath with a basement) in Richland Washington that has a mother in law suite attached to it.

Then she wanted to replace all the blinds to the style she likes (she did say she can pay for it), and she tells us that she has lung disease (she is 65, retired and has a court order where her ex-husband paid her significant amount on monthly basis).The realtor who has been on all the communication above told my husband she felt this woman would eventually bring a lawsuit to her and my husband.

Susan - The short answer is normally the liens are wiped out by the tax sale, and subsequent quiet title lawsuit. 

Is there a "special"way to price out rent for an in-law suite attached to our home?

Would it be a good idea to pay to become my own LLC to cover myself in the event of a freak lawsuit from a disgruntled renter?

A trust will not protect you from lawsuits, it depends on what you are trying to do as to what will be the best strategy

Lawsuits?

This lends to going down the path of possibly providing the tenants with financing, installment contract, disguised sales, delayed closing transaction, equitable interest, refunds, lawsuits, loss of profits... etc.