We have a SFH that has been having a number of minor plumbing problems, and now we have uncovered that one of the major drain lines (cast iron) has deteriorated and will need to be repaired.

Then, if the inspection uncovers an unknown, you can back out or renegotiate.

He's uses a formula uncovered 5 years ago while he attended an investor conference focused on identify "positive cash flow" properties.   

The only hiccup I've uncovered so far is a reverse mortgage on the property, which is well below the accepted offer.

He has quite a bit of experience in buying and selling real estate himself as well so he should have some professional/personal insight.Also at this stage we are having them uncover the tank to ensure it is still there and at least start assessing the condition.

That doesn't exactly answer your question, but it is information that I recently uncovered and found interesting.

They can uncover many of the hidden items your eyes cant see.

Sometimes things are uncovered in inspections which you can leverage for negotation.

This cost an extra $200 and uncovers things like utilities, code violations, etc.

You can also do this on your own, but the agent will be able to narrow down many options and if they're really good they'll uncover some gems or off market deals.What I suggest is doing basic deal analysis on each of the properties you visit and you'll improve the "math" skills that you mention you struggle with.