Thanks for taking the time and really rethink my approach!

Either the owners have the right to sell or they don't  but I am probably missing an approach or something there).

However, I am struggling to figure out the best approach for financing, if I do not have all the capital traditionally required for a down payment.If I decide to go with a lender, am I really going to have to come to the table with at least 20-25% down?

Your conservative approach should serve you very well, so long as you are REGULARLY putting in conservative Offers on MANY properties, rather than being tempted to be less conservative on one particular property by trying to second-guess the Seller and coming up with excuses to increase your own Risk. 

They each interpreted that differently based on their personality (and political stance it seems), but if I had to guess at the end of the day, they both get in their car, drive home and don't think much more about it.Having said that, I would guess doing something to make their jobs more complicated may not be the best approach. 

As tax season is approaching, I'm trying to find more ways to reduce my taxable income to get down to the more favored brackets.If I have passive income (rent) coming into an LLC, can I pay myself a management fee to count as income to invest into the solo 401k?

The best asset you can have is knowledge, you really won't have that until you learn real estate instead of systems or niche approaches of dealing in real estate, that's not an education, it's simply information. :) 

Last year one of our neighbors approached us saying his friends are looking for a place to stay and they can look after the property and pay $600 rent.

Dave, you are not learning how to value real estate in the investing podcasts, videos, books or other materials unless appraisal techniques are taught and I'd really be surprised if they mention or go past mentioning the three approaches to value.The computations to find the ARV are out there, but that doesn't give you the assessment of the valuation in your market. 

The only reason appraisers must go there isv to estimate the income approach used with the market and cost approach to value.