Give yourself whatever time limit you feel comfortable with to see where these actions put you after this time period.  

Go to your local REIA meetings and you'll find plenty of people willing to help you as long as you're willing to take action and learn!

I can read all the books and forum posts I want, but experiencing the actions, ebbs, flows, and nuances in the winds of Real Estate investing is where the wisdom behind the knowledge and concepts resides. 

It's just an unnecessary barrier to taking action at this point.

For liability and quality reason you never allow a tenant to pick up any tools in your property.It's nice that the work is a plus but this is not relevant to the severity of his actions.

Keep learning and taking action

Given the info we have so far, I am inclined to think the neighbor is the issue and the "or else something bad will happen" reply seems like a threat of taking action. 

Yes, one can setup an LLC online for under $100 but there a few check boxes that are critical to be selected correctly and I always recommend paying the professionals to handle sensitive items like this.I would also suggest you have the attorney listed as the registered agent of your entity so your name doesn't show up on any public records.  

"Recreation" property values are very sensitive to the economy.

Congrats on taking action!