I do I keep from owning the house my mom willed me? Will has not been probated.

You need a Texas probate lawyer to help you. No one can force you to take the house though.

Is there any papers I have to file

Get a probate attorney. Was the life estate theirs or yours? Who gets the land after the life estate is over? You need a lawyer to figure out the...

Can we sue him for slander or whatever it is called?

A no nonsense cease and desist letter is the best place to start. Get a lawyer to do that. It's fairly inexpensive. After that comes litigation,...

How do we figure out which state to form our company in?

We Texans can't speak for the other states. Consult a lawyer in Texas to guide you through the pros and cons of each typed business entity.

What can I do to get the car back?

It depends on if the estate was probated and to whom the car was willed, if there was a will.

Can the will supersede the gift deed? Can Medicaid recover expenses from this setup? What are my rights if any?

If the property is no longer in the possession of your mother when she passes then it is not part of the estate and thus the will will not control...

As a beneficiary do you get anything of cash value?

You need to find out if the POA included a right to sell land. Contact a probate attorney to represent you.

Do we have rights to get our "house back?" and were our rights some how stripped from us unknowingly.

Yes this seems like a mistake stemming from people just assuming it was theirs and not probating the estate. It appears likely he is at least going...

Yes check with smaller local banks, and retain a probate attorney to help you with this process.

What forms do he need to change the house and property taxes over to his name?

There are ways to accomplish his goals. Have him retain a probate attorney to get this done.