I have a lot of home repair skills/renovation experience and am confident I could be successful doing another flip, however I'm very intrigued by the possibility of passive income thru rentals (fully acknowledging the potential headaches).What would you wise people recommend?

Both are a skill.

You definitely have skills that another interested investor could find appealing and therefore partnering up is a possibility to look into.  

That's awesome that yours are involved at such a young age - they'll have those skills forever and they'll always be useful!

what I like about your story is you being a military pilot  the training and skills required the discipline etc that can and does transfer to the real world.. 

If you have a skill or expertise they are looking for they may invite you in. 

That accomplishes both of these things at once: your debt is reduced because you've paid off everything from your old house (and I consider your primary residence to be not-so-good debt because it doesn't pay you money, like an investment property should) and also you'll be generating income from the other units you'll be renting to tenants.This way you'll learn to do repairs and manage tenants and a whole host of important skills that'll serve you well going forward with this business.Don't sell out of your 401k, because paying that much in taxes is seriously a bad deal.

Unless you are personally skilled at inspecting houses, it may be worth to hire someone to go through the house looking for the proverbial skeletons.

There's no better place to develop your network, hone your skills, and help others do the same.

My experience has been 80% turnover every year, heavy wear and tear, and a lot of emotion in dealing with the 18-22 year old age range.I think one huge upside in dealing w/ college students is it forces you to hone your communication and management skills and systems.