I really appreciate all the advice fellas, it has already been helpful in my decision making. I have gotten more information from this one post than similar posts on reddit and other large community based forums. I think that says a lot about the community here. I used a ruler to check the chain wear and it is definitely longer than 1/16'' off. The cassette has many rounded and worn teeth as well. The reason I was thinking Chris King hubs was because I have a CK set on my single speed and as Nate pointed out it made a huge difference on the single speed. I was assuming I would need similar engagement for racing but less weight makes much more sense. I did notice that the CK hubs are a little heavier than some of the other similarly priced hubs, so maybe DT swiss would be a better option for racing like people pointed out.
I saw that there is a shop down the road from where I work on Willy street. I believe it was called Revolution Cycles. I plan on stopping in there to see what is up with the rear derailleur and to see about a new cassette/chain. I have a chain tool but its for dirt bikes maybe it works the same way. As I type this I am curious as to if the pins in the chains are the same size, probably not. I decided to just replace what I need as the time comes with slight upgrades. My end goal would be to have a bike decent enough to where I don't have to worry about hammering on the pedals. I kickboxed and wrestled for many years and I have extremely strong legs for someone my size. When I really start to hammer the chain pops off. Hopefully new chain/cassette will help. I don't have this problem on my single speed, but my single speed is a steel frame Gunnar. Maybe its possible the aluminum frame is flexing from the torque on the pedals? I didn't plan on switching any parts from the Gunnar to the treck because I am selling the Gunnar in a week or so to my brother.
Thanks again for all the advice. I look forward to seeing some of you on the trails.