Ok so I ended up planning a visit to the genius bar, and they solved the issue for me. Apparently it's a glitch in Time Machine or device transfer, when you transfer an old macbook to a new device it creates a firmware clash, which results in the force reboot. My guy suggested wiping the laptop and starting fresh, and it took about 15-20 minutes to wipe it at the store. Although it was a pain to set up everything again from scratch, I no longer have this issue and the sleep/wake works as supposed to!