We put in an offer on house #2. Even though it is a short sale, it has everything we need and has lots of potential to get all the things we want. The location is also the best of all the houses. #4 also has a good location, but despite being priced the highest and the description reading like it was perfect it was really NOT what we expected. A lot of maintenance has been let go and a lot of very obvious do-it-yourself shoddy workmanship in that house. The whole house had a really weird/awkward layout too.
Sooo we are giving the bank just one week to respond firmly to our offer, if not we'll move on and we've decided we'll offer on house #1 if that happens. Sooo we are still sort of in limbo, but we have a game plan and either way we'll be happy in either house. :)