1) At some point someone patched another layer of BID on the bottom of the airframe... OVER paint. I am not sure if someone was hiding something or what. I have started pulling... yes with my hands and a putty knife, the bid off. I figure I should sand the bottom, check for 2 BID layers and go from there. Any thoughts?
Pull, scrape, and sand it all off. I'd be tempted to sand down to bare glass and then add 2 layers of BID.
2) I can judge were someone else after the builder came along b/c it has had another paint job, directly over the old one. The person used primer in spots... but didn't sand the original coat of white. Wow. Once again I wonder what they were hiding. Would it be prudent to just remove all paint and start from there?
Was there damage disclosed when you bought the thing? Have you tap tested the structure to check for delams?
Consider stripping it down to bare glass...
www.canardzone.com/members/nickugolini/Look at Nick's 'Soda Blasting Paint' link in the list on the left...
3) Seems to have some urethane deteration in the nose... heard that was common. Was told to fix it using epoxy or slurry injected in, then weighted. Only problem, now I have a depression there. Looks like someone shot some golf balls at it. Would the standard procedure be to sand off the paint and dry micro the depression.
How about cutting it off and rebuilding it...
http://www.ez.org/nose1204.htm4) At one point someone landed gear up, doh! Which is what I believe to led to two foam blocks separating underneth the nose. Can and should that be fixed by injecting slurry into the gap and compressing the blocks?
Well, a gear up would explain the repairs/repaint seen in #1, #2, and #3. Sounds like a shoddy repair job, though. If you're certain the damage is limited to the nose, cut it off. I wouldn't be too certain of that, though.
Perhaps you should find a wood chipper and throw the old fuselage into it. Build yourself a NEW fuselage tub.
5) Fuel system a mess the valve leaks... hey I had 2 gals of gas in there! It is the old style valve. It connects to the carb, minus accelerator pump. Instead it Ts and goes to a hand primer pump, goes to copper tubing and then Ts again to go to either side of the engine. Which version is the safest/most reliable out there. Yes, b/c fuel system failure is bad news.
I would rip it out and replumb it per the plans/CP's. Did I mention building a NEW fuselage tub??

BTW, how are the wing attach fittings on this Varieze??
I second Bruce's suggestion to get a knowledgeable pair of eyes on the problem. Your project might be in better shape than it sounds... but it could also be a WHOLE lot worse.
Best of luck,
D