Can't bleed air out of rear brakes

When the pedal felt fine after the first bleed, how far did it go towards the floor? It should have only been around 1/3 of the way down. If there was a lot more motion than that wiht the car not running, then the rears probably never beld and you were just getting the fronts to work against air in the rear half. That is what the 'wife holding the brakes' test indicates.

The pedal moving down with the power booster operating is normal. A common test for booster operation is to hold the pedal down with the engine stopped and then start the engine, and check that the pedal moves down some.