No bank or lender is going to shell out money for a property with major defects (structural, roofing issues, mold, fire damage, termites, etc, etc).

Obviously, they failed to disclose this defect!

The contract says the Seller (in this case is the bank) at closing is responsible for delivering to the Closing Agent "The transfer deed warranting against title defects arising by, through or under Seller", and the contract does sound like this is an REO. 

Sound advise = Hire good legal counsel or at the very least as @Matt Motil suggested get a good title company to research this defect.

But taking a closer look at the inspection report, there appears to be a lot of issues and defects in areas that I wouldn't have expected for a newly rehabbed property, which calls to question their quality of work.For example, the report found some shingles damaged on the roof, but the roof was supposedly new?

The only reason this is not closing is because the title company will not insure title with that defect on the release.  

TL;DR – I bought a house and the seller hid a defect, do I have legal standing to ask the seller for help with the repair costs?

Or I'd walk.Or they can put it back on the market, having just wasted X days, and with the stigma of being a property that was in contract and fell out due to inspection results, and because you sent them the inspection results in writing they lawfully MUST disclose all material defects of the property to any future buyers OR they expose themselves to a crap ton of liability. 

In your OP you have a data defect.  

Buying a brand new house is a bit like buying car in its first year of production: you will be the guinea pig dealing with recalls, manufacturing defects, and unanticipated problems...whereas, if you buy a car that's been in production for 10 years, there's a better chance that the manufacturer has ironed out many of those problems ....or, that the problems have manifested and the car has a poor reputation for reliability--which steers you away (pun intended) from purchasing the car.It's also somewhat common for older houses to be "rehabbed" by flippers who use shiny new materials to cover up or distract from serious underlying problems.