They initially listed it, but they would pass it on to me as an investment.

Our problem with conventional loans is that the initial price of the houses was too low for the banks to even look at.  

Trust, but verify.4.

Things we've thought of, particularly considering their health situation, include making sure his ducks are in a row to keep it out of probate should their health take a bad turn (we've verified his corporation technically still owns the property and he's all the officers), still getting an appraisal within 30 days (it will also still be valid for the lender). 

Make sure they have at least 2 times the rent verifiable income and employed same place for at least 90 days.... the best thing you will ever do is realize a bad tenant is worse then a empty unit !

How did you verify they were any good?

If the remaining 15% includes projects that may have some hidden costs, I would counter after those projects have been completed or at least completely exposed so you can verify your budget for that item.

I stand by my initial evaluation, but again, I am not licensed to practice law in Florida or anywhere else.

My initial plan would be to fix up the units to rent at around 1000 to 1200 a month.

I would go on eBay and buy a couple fake 15$ security cameras and mount them up in the corners of ceilings under them leave a sign that says overloading the machines damages the units .Then it will be at operators expense and cameras are in use to verify .