Is there any way I can start to distinguish good opportunities from bad ones so I can go into a conversation with at least some knowledge?

That type of area is a very specific street by street case when it comes to good and bad rentals in the area.

I honestly don't actually think those things would get THAT bad if i raised the rent, but anyone who's had a "bad neighbor" can tell you how miserable life can be with one.

One of the reasons Memphis is a perennial market for investors is the availability of properties that are not in the "bad areas" and they can cashflow very well.As an OOS investor, I'd suggest that you start with the location as your 1st priority.

This is part of the reason I haven't pulled out maximum cash out of every project, as I don't want to build a house of straw , rather one of bricks less the big bad wolf comes a blowing. 

Unfortunately, PMs are so bad in Wenatchee, the owner/DB of 1 of the 4 largest brokerages here begged me to get licensed as a PM with her firm so she would have someone to recommend her clients to. 

If the location is bad, maybe cut your losses.

Is leaving the 60,000 in equity on the first home a bad idea?

If the tenants destroy the property, then they could loose their benefit (at list that's what the Sec 8 office told me I never experienced it) Also Landlords are allowed to give surprised visit to applicant's current resident prior to approval and if the property is kept in bad shape or they don't allow you to enter and inspect, then you can decline the application.

Fire that realtor and get a better one..... there's no way a house that has issues that bad should even get to the inspection point (unless it was at a price that made sense).I look at properties all day, if I see something I pass it to my realtor he takes a look, if it passes that he'll go view in person.