Its worse than I thought. I really think there are 100+ trees on it. Not to mention the width of the dam is very narrow. It also drops straight "down" right at the middle of the dam. There is no slope at all. The back yard property line of those houses are only about 30 yards from the dam. I really dont think there is even enough room for a perfectly built dam. Long story short, I'm done with this, hopefully its a learning experience for someone in the future if they ever see this. Luckily I never put any earnest money down!
I have convinced my self and my wife that sleep is more valuable at night than having to worry about this problem. I talked to the land owner today and told them an engineer needed to look at it, and they said that I needed to pay for one.
The way I see it this is no different than finding out a house has termites at the inspection and at that point , it is the sellers problem, not the buyers! Im going to call the realtor and tell her im not interested. Much less headache that way.
Thanks for you guys input. My property is right next by, so if anything ever happens I'll let you know years down the road. After looking at the pictures I posted on this reply, a problem WILL happen, its just a matter of when.