Apparently, not only did they sell at a loss, I didn't get any money back at all and they claim I owe them an additional $40,000 for "renovations" despite no work being done to the building at all. 

Contributions for development and remodeling will be capitalized, increasing the property’s basis and reducing taxable gains upon sale, though these costs are not immediately deductible.The LLC Operating Agreement must clearly outline how contributions are recorded and how profits, losses, and expenses will be distributed.

Most are being encouraged to buy Class B-minus rentals and below, but no one corrects them about their mistake of using Class A assumptions on these rentals:When a newbie gets smacked with reality via their losses, they then can only suck it up until time improves their mistake or dump at a loss.So, my question is, why can't we all do better and grow our industry with integrity?

Chances are very high that you are not claiming tax losses that you should be.There are many ways to create relationship problems and one highly successful one is mixing business with pleasure. 

It’s unnecessary and potentially problematic to add the ex-partner to the title before the sale.

Understanding the market enables you to spot good bargains and steer clear of potential loss-making regions.

This would apply to your unit.Your biggest concern with setting the rent should be the near future. 1) Your insurance is guaranteed to go up, probably dramatically.  2) You may get an insurance assessment bill to cover the CA Fair Plan losses.

After 2 years I have had to replace very few items, whether that be from theft, loss, or over usage. 

Save your money, buy some index funds, reduce your expenses (e.g cut out any unnecessary expenses Netflix, going out, expensive purchases, find a cheaper apartment if your rent is high). 

Since you're a high-income W2 earner, you may be limited to passive losses write offs only.