Do returns on those types of arrangements typically beat the stock market?

Generally the advantage is that you can 1031 a smaller amount and switch to passively investing, at the expense of (again, generally) more modest returns.Investors can also 1031 Exchange into a syndication through a Tenants In Common arrangement with the operator, but the minimums to do so are typically much higher than DSTs.

What is the typical arrangement for distribution of cash flow, profit sharing, and sales proceeds?

As the IRS concluded, when properly structured and administered, ROBS arrangements can satisfy both the requirements and spirit of the tax law and can serve a legitimate tax and business purpose.And yes, it is VERY important to work with professionals that have a track record of success in deploying and managing ROBS structures.  

But based on the terms you are getting, it looks to me like the seller is pretty knowledgeable about Real Estate.Which makes me wonder.DI d you get those figures from the sellers or the person arranging the transaction?

Sure, move back and take care of his dad, but even if it takes a couple weeks to sell can't other arrangements be made to help him get the most for his house rather than tossing it through a middle-man?

After a few calls we arranged a meeting and she was aware I was coming from the west coast and had a tight schedule.  

You could even arrange a 1031 exchange of sorts and not pay taxes.

Most attorneys will be more receptive to this arrangement.

You might not be swinging a hammer or fixing a toilet but don't be fooled that finding financing, arranging loans, looking for deals, and all the rest of it is any less time intensive.