Would it be better to not bid on the auction and communicate w/ the owner directly in the hopes of arranging some kind of direct sale? 

Ultimately, what this does is increase prices for consumers & pull the activity off of legal channels where they can be taxed & monitored.

sounds like you have an agent problem, communication should be WAY tighter.

Here are the caveats...I have been communicating with the owner.

When i change my mind as an investor will I communicate whats changed to my Realtor ?.

And since 1031 is a federal statute you need to look at what makes you the taxpayer from a federal perspective.Since the way you communicate with the IRS is only through your tax returns, the taxpayer for a property under 1031 is actually the tax return that reports that activity of that property. 

I run the office, I have two full time maintenance guys, a maintenance director, someone to communicate with tenants, and someone that does leasing.

I'm sorry I didn't respond at the time, I need to work on my forum/social media/communication rate for sure.

Do I need to respond to her via a certified letter or would regular communication suffice?

I've been reading & leaning about real estate investing nonstop for nearly a month now, I'll make sure i communicate how much time I've been putting into it and how much i want to be successful in this field.