It certainly appears that Brelo lost it, but so did dozens of other police as well, most or all of whom have refused to testify, claiming fifth amendment protection.
The LA Times article covered these troubling aspects fairly well.
No gun found: It was a long chase and of course the gun might have been ditched.
No gunpowder residue: not that unusual.
These chase scenarios are notorious for getting the cops' blood up, which is no defense. However, the perps could have stopped at any time, the original gunshot aimed at the police came from their car, and all things considered, from the outside looking in, this could go either way. The defense, in waiving a jury trial, must either feel they have some strong exculpatory evidence, or are seeking to minimize the sentence if their case is weak. Could be the old "guilty with a good explanation."
The one fact that does remain is that, given the police records of both the dead men, it is a mystery as to why they might be made heroes by their neighbors. They were both the sort of men we pay the police to forcibly separate from the rest of us.