If the redeeming party failed to pay the money into court when they filed the lawsuit, then the one year did not stop ticking down and now they can't redeem.

Thats the part I was thinking of.

You should start at municipality,with title insurance claim, then try working with seller directly.After exhausting these I would be sitting down with an attorney and sharing the fully paper trail for closing and the follow up with each of the three parties above to file a suit to let the courts figure out exactly where liability rests.

I would not cancel the deal- I would allow the seller to do his thing, then schedule a final walkthrough  and bring a 3rd party with me (contractor, handyman or inspector). 

One part I am struggling with it to figure out how much I would be paying for utilities.

It was forty minutes from my house, next to the beautiful Golden Gate State Park, fifteen minutes to the casinos of Black Hawk, fifteen minutes to the quirky town of Nederland and twenty minutes to skiing.

Also one allowing you to review the documents (rent roll, P and L, Tax returns, insurance claims history, 3rd party agreements, leases) which allows you to terminate the contract if you are not satisfied.

If you literally feel like your twiddling your thumbs you can come up with contingencies for when bad things happen like not paying rent, not getting along, not keeping house clean, partying too much, etc.

Will any of the parties to the transaction inquire if I have the licenses to conduct this business? 

For the most part I don't think it is that hard and not as hard as most people think.#2.