"Oddly enough, the home exclusion CAN cover the unclaimed depreciation.  The unclaimed depreciation still lowers the Basis, but if the gain is under the amount of the allowable exclusion, there would not be any tax."

Maybe we're talking about two different things.  You can't exclude the amount of the basis adjustment due to depreciation allowed or allowable.  So there will be tax on the 1250 gain.  See 121(d)(6):

https://www.law.cornell.edu/uscode/text/26/121#d_6