With the exception of property improvements, expenses incurred to "prepare the property for rent" that very first time are never deductible. It's one of those things where you just have to suck it up, unfortunately.
Personally, that's exactly what I would do and not waste my time and effort with SCH E at all. One good thing is that since it was your primary residence for 2 of the last 5 years you owned it, your gain on the sale will be tax free up to $250K if filing single, and $500K if filing joint. So I'd have no problem sucking up the losses as I was handed my tax exempt gain on the sale.
