You would have had to be there for at least that to save on the capital gains taxes (up to 250k). 

Any advice on what setup is easiest and most tax advantaged?

Yes, do the tax exchange if you can.  

Avoiding the ravages and savages of the divorce court system. 

Consult your local CPA to calculate accurately and minimize your tax liability.

For instance, Berea is a charming college town, but the combination of local taxes and less favorable price-to-rent ratios makes it less appealing for investment compared to other areas in the state.Agree here! 

Utilized a low down payment loan, maxed seller credit, tax proration and closed on the 1st of the month to maximize my cash and acquire this property What was the outcome?

There are some programs through local government systems where you may be able to receive a tax abatement or grant here in Michigan in an effort to help beautify a neighborhood.

He will get around $3,100 tax free Base housing allowance and will have $150,000 he can put down.  

Creative financing can help sellers make more money, solve pain points, gets them the money they need, and help them avoid a high tax bill.