"Would you say that looking back, going through the legwork of establishing a Reg D entity was worthwhile for you on that deal in comparison to just establishing a basic LLC structure with multiple members?"

If this is not cured or any other damage I would look to removing this tenant. 

Prevention beats cure.

But you simply issue a notice to cure.  

All it takes is one tenant who knows their rights or calls Legal Aid.When this might be legal (very narrow scenarios)There are only a few situations where taking possession without eviction court is defensible:Clear abandonment, documented thoroughlyNo belongingsUtilities offWritten surrenderKeys returnedSquatters with no tenancy established, and even this is increasingly contestedPost-eviction lockout, after a sheriff executes a writWhat you described does not fit these categories if there is a valid lease.Why people still talk about itThis “service” persists because:It sometimes works when tenants are unsophisticatedTenants don’t always fight backEnforcement is complaint-drivenBut when it fails, it fails badly.This is survivorship bias, not legality.The correct play in CaliforniaIf the tenant has a lease:Serve proper notice (pay or quit, cure or quit, etc.)File unlawful detainerLet the sheriff handle possessionIf timing or cash flow is the issue:Cash-for-keys, properly documented, is far saferVoluntary surrender agreements work if done correctlyMediation often resolves faster than courtThis is not a gray area for landlords.It’s only gray for people willing to gamble on tenants not fighting back.If someone is offering this as a “service,” they are shifting all legal risk to you, not them.

S8 is NOT a cure-all for tenant payment issues.Also, despite what you read, the only way S8 pays more than market rent is by buying properties in Class D Neighborhoods. - But, then your challenge is finding decent S8 tenants that want to live in a Class D Neighborhood. 

In other words like most things the government gets involved in, the cure is worse than the disease.   

See the chart from Fair Isaac Company (FICO) below: FICO Score Pct of Population Default Probability 800 or more 13.00% 1.00% 750-799 27.00% 1.00% 700-749 18.00% 4.40% 650-699 15.00% 8.90% 600-649 12.00% 15.80% 550-599 8.00% 22.50% 500-549 5.00% 28.40% Less than 499 2.00% 41.00% Source: Fair Isaac CompanyAccording to this chart, investors should use corresponding vacancy + tenant-nonperformance factors of approximately 5% for Class A rentals, 10% for Class B and 20% for Class C.To address Class C payment challenges, many industry "experts" are now selling programs to newbie investors about how Section 8 tenants are the cure.

See the chart from Fair Isaac Company (FICO) below: FICO Score Pct of Population Default Probability 800 or more 13.00% 1.00% 750-799 27.00% 1.00% 700-749 18.00% 4.40% 650-699 15.00% 8.90% 600-649 12.00% 15.80% 550-599 8.00% 22.50% 500-549 5.00% 28.40% Less than 499 2.00% 41.00% Source: Fair Isaac CompanyAccording to this chart, investors should use corresponding vacancy + tenant-nonperformance factors of approximately 5% for Class A rentals, 10% for Class B and 20% for Class C.To address Class C payment challenges, many industry "experts" are now selling programs to newbie investors about how Section 8 tenants are the cure.

Problem was that there was environmental concerns, with estimates of costs to cure ranging from $60,000 on up.