1) The 1098T is just showing the tuition. For tuition I would use the difference 26978-14750=12228. Add in other deductible education expense to get your appropriate Education Expense total.  https://www.irs.gov/pub/irs-pdf/p970.pdf may come in handy. 

2) The distribution code 1 is totally taxable. That is what allows you to take the education credit and not have it be double dipping. The amount spent on education is NOT subject to the early distribution penalty, IF IT WERE AN IRA. Since it is a 403b it is subject to the 10% penalty https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-tax-on-early-distri... that will show up on IRS 5329 and probably some state form.  The 1B is from a Roth and is likely not taxable, but you would need to determine the Roth basis.  https://www.irs.gov/pub/irs-pdf/p575.pdf may come in handy.

Sounds like a typical WHY DID YOU WAIT SO LONG TO SEE ME moment.