Not sure what you mean by handle the reference. List it on your resume openly and honestly. I wouldn't put the "jerks who screwed you for money" down as a reference. They are unlikely to say anything nice. If you don't have a lot of work experience and need a reference perhaps a co worker who you are friendly with could do it instead of your boss.

They'll probably give you a good reference. They want to be the good guys on paper. However, if you are asked to give a reference for them, I understand that it's illegal to give negative criticism for an ex-employee review. I usually say something like, "It's not legal for me to comment negatively about XXXXX. Understand? Bye?".

That's hard; I've been there. I tend to smile and bear it. As long as you weren't as much of a jerk to them as they are to you, hope for the best?