Your 121 exemption would only apply to the gain/profit on the last transaction....all prior deferred gain would become taxable.

We thought about a self directed IRA but we would like the profits to come to us directly.

But we sold the building for $380,000 and after our closing costs our profit was $125,000. (380,000 - 255,000~).

I assume we should go to a bank to get pre-approval before we pursue a deal? 

Based on what I know about you and your situation (almost nothing) I would recommend you get a job and ensure you are financially stable before pursuing investments.

Should I show a profit on the farm, pay the taxes and be able to qualify for more loans or go with a HML?

For me the numbers on This return would fit more favorable with white collar cities because I would be able to landlord on autopilot or less hassle free than blue collar towns in rural areas where if one loses a tenant it may be months of vacancy which will eat up profits in no time.

Recently, I've been throwing around the idea of selling these and taking profits(we forced appreciation through raised rents and/or rehab).

Lending the money is an easy way to make a great profit and I do not have to get out and search for deals etc.

That's not a step transaction, has terms and has to be repaid as opposed to accessing profit.