Can plan assets be used to pay real estate taxes (as an investment expense of the plan) if the plan holds real estate?

Absolutely, who else is "legally" responsible for the tax but the property owner

I had a plan with such an "investment" audited by the IRS. The agent insisted that the taxes, if paid by the sponsor, be treated as a contribution. Looking back at it, I'm not sure that treatment was required, but we went along with it at the time, since the auditor only insisted on this treatment prospectively.