Should I immediately rescind my offer and tell the seller to fix that situation and get back to me after, reassess/resubmit the offer with the eviction factored in, stay put and inquire more about the eviction, or whatever else I'm not thinking of?

I stress to you large opportunities so here is a thought - check with a local LO with USBank and determine if they have an appetite for your situation.

I figure if i find a good deal that doesnt require too much time or money in repairs and find a suitable renter, its more cashflow to give me that little boost to get started before i can make some waves.So my question or advice that im seeking is, when i do find the deal(s) that i like, do you think it would be more beneficial for my situation to buy at 3.5% down and buy more houses that way in order to get the ball rolling or put down 20% on one house?  

It's always situation-dependent. 

thanks guys....It really is a tough situation.

I'm new to the site as well.I agree wholeheartedly with @Jim Wilcox about the need for a strong lease (e.g. one that covers all types of situations).

You have a square peg / round hole situation which is always tricky in insurance.

I agree, you never know the full situation so offer and see what happens.  

There are lots of situations where we'd say the guy is living there but a new couple wouldn't think of him as living there.

I can't really ask for a better situation at the moment.