my Mortgage interest was about 160% of the 1098 value
That's because you entered mortgage interest twice. Once on the SCH E, and again under the Deductions & Credits tab in the "your home" section. You only enter it *one* *time* on the SCH E, and the program will take care of the split between SCH E and SCH A for you.
is treating it as a separate Vacation Home
That's absolutely correct for the year you convert from rental property to personal use. Just make sure that when asked for your days of personal use, you enter the digit ZERO. That's because the program is asking for the number of days you used it for personal use *while it was classified as a rental*. Since you did not live in it while it was classified as a rental, your personal use days is ZERO.
