So I just got back from Mexico and I noticed nearly all the houses are built with cinder blocks.

If it is more than a few blocks away students will unlikely to be interested (<0.5 mile). 

This location is PRIME & safe, it's a 10min walk to downtown Durham, a 1min walk to their Physician's Assistant School, across from a beautiful park, on the same street as a bus stop which helps students/guests without cars, has a HUGE backyard, it's the most expensive zipcode in Durham, the surrounding homes are all well maintained, it's a historic neighborhood, there are townhomes being built a block down starting at $650k and more being built two blocks away starting at $800k.

The outside of the house looks well maintained and cared for, not in obvious distress. perhaps there are foundation issues, but it's block and beam so I'm not entirely sure how difficult that is to fix. it has window units but lists as having central air, possibly it's broken?

They have three kids in high ranking public school half a block away.  

I don’t know what causes the concrete blocks (walls of the house) to crack like that and am worried about an underlying issue that will lead to expensive structural problems that I will be liable for if I purchase.

I have had a 3/2 property on 37th Street about a block from the beach.

I assume you mean some kind of code violation but that rarely has any impact on anything other than to cut your lawn by the deadline the code enforcer told you to cut it by or, to remove the car on blocks from the driveway.Open permits?

I have otherwise good tenants who can't help colonizing the hallway with their crap blocking the way of other tenants even after speaking to them several times.

The fact that this hasn't gotten through to her could be one of two things: A) flakiness (she's had it before; may not be malicious), or B) she's hiding something and maybe already doesn't expect to get the SD back.I think at this point threatening to send a locksmith at her expense might be the best of a bunch of bad options though.