It's an asset which has a depreciated cost basis which you increased by deferring gain from a prior proper by way of a 1031.

It has a huge backyard,and I can build another 900 sq ft 2 bedroom unit which I think will add $100k to the value of the property for a total of $300k.But there are no comparables, and my realtor could only give me duplexes which were only about $250k.My question is should I build this second unit rather than look for another "very hard to find now" flip?

If you have have existing LEASES, you need to honor the leases until the end of the lease.  30 or 60 days, prior to the end of the lease send a notice to the tenant telling them of your intention not to renew the lease.If you have a month to month agreement or no written agreement, give a written 30 day notice to vacate.  

I received 2 quotes for the roof replacement prior to and both quotes are lower than what I put the estimation at, I added about $2500 more after receiving their quotes.  

I assume the house is in nice shape/comparable to other 2/1s in the area?

If this is the case you will most likely need to have your sale associate license active with a broker for two years prior to getting your brokers license.

The back house can rent for $800-$1000 per month, when I compared what other units in the area with the same specs are renting for.

Compared to that apartment, my duplex side has 1 more Bedroom, 40% more sqft, a nice yard, a 1 car garage.

The houses in central Il are not very expensive compared to other parts of the country, property taxes are crazy high though. 

I'd base my offer around the property's income combined with my demanded rate of return, as well as the comparable sales in the area.