The last time I ask IRB officer, they say cannot...   

But still... they are not lawyers..

I'm no expert but I've been deducting insurance, quit rent, assessment, repair and maintenance expenses for my property.

The offsetting of losses is only available in relation to business sourced income.  The renting of two properties can constitute business income.  In order for rental of property to be considered as business income, you must fulfill certain criteria as per Section 4 of the public ruling:-

http://www.hasil.gov.my/pdf/pdfam/PR4_2011.pdf

The main criteria is you must actively provide comprehensive support and maintenance services on the property you are renting out.  Long story short: you must pay for the repair and maintenance of the property and all facilities in relation to the property.

In your case, if you are paying for the maintenance fee which arguably is the fee to maintain all the facilities of the property under the management office, and you also pay for the repairs of the fixtures in the property (i.e. air-cond), and you pay for the quit rent, assessement, insurance, etc.  I would say you have a decent case to argue that your rental income is business sourced. 

If you choose to take this route, this means you file a Form B, and no longer file a form BE.  Your rental income becomes Section 4(a) income.  You need to also bear in mind that if you choose to take this route, you will come under greater scrutiny of the IRB, and will need to ensure you maintain proper documents of your spending to justify the amounts.

If all the above are true, you can treat your rental income as a business source and offset the loss of one property against the other.  In addition, you will be eligible to claim "capital allowance" on certain fixtures (i.e. aircond, cabinets) and furniture you provide in the property as well.
With regards to your second question, if your rental income is a business source income and you make a net loss overall, you can set-off this loss against your employment income in the current year.
Precautions

To argue your rental income is a business is an argument of fact and must be supported by the history of your actions  And to take this position is quite aggressive as well:-

- you must have actively sought out tenants (by way of engaging agents, or advertisements).  This must be proven by photos or receipts paid to agents.

- The documentation between you and your tenants must be fairly decent. By this I mean you must have a proper rental agreement to spell out the responsibilities of both landlord and tenant

- You have a better case of winning this position if you have more properties in your portfolio.  1 property makes for a very weak case.  2-3 and you have a fairly decent case.  4 and above, I would say its almost iron clad.

- The provision of comprehensive support and maintenance services is very tricky and vague.  To strengthen your case, I would advise that you show that you provide repairs and other services (i.e. cleaning) on top of the management fee.

Finally, if you choose to take this position, please make sure you get a consultant to give you a proper written advice so that you are up-to-date and have written proof to back yourself up in the event of an IRB challenge.  Make sure it's worth your while to take this route, because its not worth the hassle just for a few hundred bucks difference.