You've heard the old saying: "He who fights and runs away lives to fight another day."
I think it's time to consider throwing in the towel. Refund the security deposit (to the estate of ______), change the locks and rerent.
Weigh that against battling this thing for months and losing all that rent that you could have been collecting from a new tenant.
I know, it would stick in my craw, too, if I had to back down from something like this.
The longer you hassle with this the more it becomes a lose-lose situation for you.
Not telling you to do it, just giving you something to think about.
And while you are thinking, read about "pyrrhic victory" in case you want to battle this to the bitter end.