APPLY THEIR VARIOUS BEHAVIORS,  WORK ETHIC, ETC TO YOUR OWN LIFE.

That is fine if you are flipping because that is the proper treatment there, but it is a major problem is you eventually also have rentals that you occasionally sell (you also cannot 1031 inventory, so dealer status is also problematic there). 

These are professionals with additional training and a stricter code of ethics.

This may be a controversial strategy because it could potentially but real estate agents in an ethically questionable situation. 

I want to do real estate investing and I AM interested in RTO but I want to act ethically. 

The key that qualifies property for 1031 treatment is the actual sale of real estate and purchase of actual real estate.This is where the fund will not be available because you are probably not purchasing a tenant in common interest in the real estate itself. 

Aside from whether it’s doable, is it ethical and/or legal?

Figure out what you want - would you like to be released from the lease and move to a place with a knowledgeable and ethical landlord, or do you want to stay there and be firm with enforcing tenant-landlord law with him?

No title insurance could come to bite you at the end too when you sell.But overall it seems like you're on a great path to success with the right work ethic and team in place.

Friends push boundaries and get special treatment....great customers do also but not to the extent of what friends get.... this is a business, not a social event.Be professional, courteous, kind and respectful..... but run it like a business