So...Purchase: $109,000 (listed price, buts it's fallen out of contract 3 times - is that enough to motivate the seller to reduce the price?)

Joseph Ask the seller to carry the financing.

For Sale by owner, Sales Agreements.I’m curious to learn what clauses or protections others builds into their sales agreements to ensure (or allow for legal action) if a private seller sells their property to someone else / backs out of your deal once already under contract.Fortunately this has never happened to me and the last 6 properties I bought were from private sellers without a real estate agent or attorney, however It could and likely will happen at some point...

The value usually comes from deferred maintenance or some other seller distress. 

I am thinking that this house is probably going to make a good rental for someone but how do I advertise it, should I offer the seller less for the unfortunate view?

Your average buyer is not informed enough on the cost benefit tradeoffs of these technologies to be able to perform a thorough analysis of the improvement, and so they won't perform it, and therefore the demand simply does not exist.  

If the seller don't like your offer you just continue to the next.

Can a seller cancel a 30 day contract one day after signing claiming that you didn’t tell them you were a wholesaler and you let them know that you are real estate investor

The seller is replacing the roof prior to closing.

The exception might be, like you say, a high demand area with high rents.