I finished the third pass cleaning up the picture rail last night and Jeff did a bit more detail work on the crowns. I've gotten the woodwork in the closet cleaned up so it is "good enough." (My standards for inside a closet are a bit lower than for inside the bedroom proper.)
We still haven't figured out what to do with that bad patch on the baseboard. We'll take a closer look at it and see if we can remove the spackle and get it filled with wood filler. If not, I'm contemplating just covering it with a blank utility box cover.
Jeff has started digging spackle out of nail holes because it makes a lot more sense to fill them with wood filler before we sand. But, once we finish this bit of repair work we will be at the sanding stage! Woo hoo!