This should exclude up to $250,000/$500,000 in taxable gain for a single/married person. 

The problem I am facing is if I make my investment property my primary residence, will I have to pay back any depreciation taken while it was a rental property and also since I have owned it for 17  years and rented for 15 years...will I be able to exclude capital gains if I tear down the house rebuild a larger house which I will live in for at least 4 more years? 

Not ideal, but not something I would exclude either.

Every old building has environmental issues excluding the .0125% exception.

So Principal and interest, and mortgage insurance should be excluded?

I do not believe that any city in the midwest would have the cash flow of a San Diego purchase from 20 years ago (excluding having extracted out equity via a refi - every investor probably has extracted value).It is important to distinguish initial cash flow from actual cash flow. 

If the are not excluded then it will be part of your due diligence.

Much of your gain will not be excludable and the depreciation recapture won't be excludable either. 

As for the swing set, depends on the condition, along with what your landlord insurance policy covers (some policies exclude pools, bounce houses, trampolines, etc).

@Cyarnae Fields  From our friends at the ITS:"If you have a capital gain from the sale of your main home, you may qualify to exclude up to $250,000 of that gain from your income, or up to $500,000 of that gain if you file a joint return with your spouse.