I worry about how a potential bad deal could effect our relationship considering we will also be in close living quarters with them (which can potentially get sticky) and I know what can happen when the in-laws clash (my mother lived with my wife and I for a little bit and that was a complete disaster).

First you will want to think about getting your own fresh leads @John Anderson which will take time, but it's more effective.

Any insight on what is needed to effectively work this market I would greatly appreciate.

A million dollar property needs to bring in at least $10k/mo of effective gross income, especially with management and the can't drive by and look at it factor.  

How does this effect a property under an LLC?

Many RE agents like to add them on to sales because they are cheap and effectively deceptive

(hope this isn't considered advertising)The 7 characteristics of highly effective people - Steve CoveyEat that frog - Brian Tracy 

Go to annualcreditreport.com, it is the site created by the three credit reporting companies.Obtaining a credit report for yourself does not negatively effect your credit score.

I am interested to hear from you experienced Chicagoland wholesalers some of the hottest areas for wholesaling, those not yet saturated if any, and your most effective marketing strategies in this market? 

A business structure might have stopped entirely or lessened the effect of that lawsuit.