I've done very little JV'ing and understand your concerns on the arrangement. 

I understand that ultimately, the responsibility falls with me...but I also wanted to reach out and see if anyone has a perspective or strategic approach to rectifying this manner. 1) Connect pipe (50ft) - not overly concerned with this aspect. 2) Clean up and have restoration company undo the damage - mildly concerned and expect a few thousand dollars fee (who pays?)

For you, as a potential passive investor in a syndicate, you are most concerned with how much money you get back, and when. 

The only concern is that, being a newly formed LLC, there is nothing to go after.

Obviously that is a bit extreme but just illustrates my point.The reason I ask about self managing is because of you wanting to be passive.

To give solid advice the community will likely need more information, (where you want the vacation rental, how much you think you want to pay, any questions/ concerns you have) It is difficult to give advice with no supporting information. 

What are major concerns for the decision; and how many started out flipping their primary residence and rehabbing while living there?

Once they purchase it is a great opportunity for them to begin to generate wealth as the developers/investors help their property appreciate in value by increasing the comps.5-10 years down the road they will be extremely pleased that they purchased when they did.

You have to know the buildings which are friendly to STR as far building management is concern.

You have to live in it for 1 year unless something extreme comes up in your life that requires a move (change of job or military relocation).