I've recently formalized my business by creating a corporation. 

We have a formal treasurer who leads with handling the finances, which we can request at any time to see.

If I did approach him about this I would use an attorney to formalize everything and do my due diligence on his business model, but what else should to protect both of us? 

I know a formal inspection will tell everything I need to know.

The new Judicial building will be bringing in 1200 people PER DAY to Lowell and many of those people won't want to have the hassle of getting in and out of Lowell.  

Now my question is how do I go about formally asking the seller to make the repair? 

It is subject to probate court confirmation but the auction house says that that is just a formality, there's no real sign off and what it goes for is what it goes for.

I would take careful notes of how the story changed and send a formal demand for the return of your security deposit - I'd fight it for justice, but there isn't shame in backing away (and not giving them any more money) if you're not up to the fight.

Is there any danger in having someone live there and not formally added them to the lease?

BTW, these are the two warnings you had to go through to get to the bidding site:From the Clerk's site, the page that leads you to Realforeclose:Foreclosures Judicial sales of real or personal property are conducted by the Clerk pursuant to F.S. 45.031.