No "meeting of the minds" on the contract, misrepresentation, incorrect docs, etc.

I explained that they were tracking it incorrectly and after several more emails they agreed.

Odds are that he was just incorrect in his first appraisal like you stated, but he may have had new/better data in the second appraisal that just didn't support the original number.In many cases, a contract price is the best indicator of value, assuming the agreement meets the definition of that type of value.

as Ari said, something is incorrect because those terms are impossible.

This is usually in the form of bad debt but can also be from using the incorrect variance to calculate the utility rate (very common).  

Although he is likely mentally unbalanced he will simply move since all his threats are posturing in a attempt to intimidate, and seems to have had a effect.Get rid of him asap for the sake of your tenants.

You account for PITI and HOA and "upkeep" I'm assuming(maybe incorrectly) that is not a large number you've used for that.

Will that lawyer GUARANTEE that in writing and face legal ramifications if they are incorrect??

Can anyone who wholesale in California please confirm if this correct or incorrect. 

You made a ton of incorrect assumptions there.