The tenants have had that moved out moved out due to a car accident (going on disability),  moving to a larger house with girlfriend, moving to a safer area where the house won't get broken into, and losing their job and not being able to afford the house.

I bet filling with dirt would be a lot cheaper and just as effective. 

In my opinion a SFH or multi unit is your best bet.

Work with an experienced investor with a lot of connections in your area, that's probably your best bet.

Their best bet is a short sale, but we have no idea why the first two fell apart.

It's a good bet that the places that saw the biggest declines will still be the weakest come the next market decline unless they've had some major changes (neighborhood revitalization, new public transportation options, etc).  

Mom is going home in two weeks after the hearing I would bet. 

If you just want cash, then option number 2 is your best bet as you can take out the cash from the property sans capital gains.

Being that I already have a full time job, I would have to hire some kind of property management help.From common sense it's a lot more economical in the long run and less of a hassle to manage/aggravation to invest in a safer area. 

But, I'm betting on appreciation in 2/3 years.