I asked my attorney what recourse if any we had since we paid for property taxes for the month and lost time for what I would have begun day 1 after closing, and was told that if we were going to attempt to hold the $1k he had put down, the buyer could end up contesting and the legal fees would not be worth it. 

Most people are attempting to get asset protection by segregation. 

Between the restaurants, the cost of housing, and the taxes, California is attempting to strip you of your wealth.

I will be getting married in September and neither of us know much about real estate, so I'm attempting to spearhead our self education. 

Building on hills for the first attempt?

I did not see anything in your post that stated you have attempted to work this out with the tenant over a certain period of time, but he has failed to respond.

Should I look for 2+ BR in a good school district in an attempt to try to appeal to a family (however this obviously would cost more money).

Michael Guerra ,I would attempt to get a job as an agents' Administrative Assistant so you can get your hands dirty learning real estate sales without actually working directly for clients without MLS access.You can learn by shadowing agents and doing their paperwork and other tasks you will do for yourself eventually when you do get your own clients.If you join a good sales team,the lead agent may offer to pay the costs you seek for you in exchange for working on their team for a set period of time.

Currently I am working full time in Anchorage (and I also commercial fish in Bristol Bay) and am attempting to buy my first property. 

Our question is for anyone who has purchased all cash before and attempted to refi the property ASAP.