The eagerness to possibly own a building may be clouding your better business judgement.  

If the title is clouded (liens or encumbrances) or it turns out they didn't have the right to sell it, you have no recourse with the grantor short of fraudulent behavior.

If it was a 5 year note and 10 years have passed then a quiet title or even a lawsuit for damages due to having a clouded title. 

Is it crazy to think that 40k discount off of the appraised value is fair, given that the improved price is could be as much as $600k for a house this size in Los Angeles or have I let the flipping shows cloud my vision of reality?

All accounting is moving to the cloud and Xero will auto categorize your bank feed and makes reconciliation really easy.  

The numbers work beautifully, if I can fund, but I can't because of the cloud. 

The mobile app is not amazing but the cloud based computer version is pretty cool. 

Does tenant cloud send payments to homeowners  and collect rent too?

Due to no experience, I'm also looking for legal help in drafting and/or negotiating the purchase agreement, reviewing title reports, working with the title company to resolve any clouds on title, preparing the deed/attending the closing, etc...What is a reasonable rate to pay for a real estate attorney to represent me on such transactions?

The first thing befor running off to hire anyone is to look into a great software, cloud base, managment system.