I have a plan in place to buy a 4-plex and live in one of the units for a year and also negotiate closing costs to minimalize my out of pocket investment.

We would also self manage this but would hire the work out to turn over the units instead of DIY to minimize vacancy. 

Our partner denies everything I’ve been told by contractor and that she wasn’t really trying to keep me in the dark but she wasn’t being paid to teach me.

If it is minimal, no issues.

When I rented it last year during a cold market it took 40 days to rent and the number one complaint was  the apartment is too dark.   

It would minimize your losses through commissions if they would exercise the option part Most likely still end up losing money each month.

If you're trying to make a minimal down payment it's not likely you'll see positive cash flow but the rental income will offset some of your living expenses.

Minimize all living expenses.  

Given that there have already been a few surprises with this property and I'm not sure how confident I can be at this point that the deal will progress to closing, what's the best way to minimize both mine and the Seller's out of pocket exposure in the event the deal falls through quickly?

I have closed on a few properties a long time ago and it really wasn't that difficult from what I recall and I had zero experience at the time and zero issues as well.However, now I would suggest calling a local real estate attorney and ask about their services to write the contract and perform the closing for you.It could save you some big money with the realtor commission and besides you are getting valid legal advice and minimizing your legal risks .