Indeed, the state of Ohio is saying that you can not decide that one of the investors will report a different portion of the company income as being income from within Ohio than is the case for the company as a whole (and I agree).
It is generally not at the discretion of the partnership to allocate all or none of the income earned for performance of services in Ohio differently to one of the partners. It is not at the discretion of the individual partner to report the allocation of state income differently than the partnership has allocated the income. Certain tax items, such as "nexus" to a state, must be determined by the partnership and not the partner.
For a technical discussion of nexus of out of state entities see the article linked at http://taxprof.typepad.com/taxprof_blog/2008/02/the-evolution-a.html
The correct allocation of partnership income to a state depends primarily on where the services were performed or where the operations of the company took place (as a general rule). Software sales would usually be attributed to the state from which the sale was made and not the location of the buyer. If there were significant services more than those that were ancilliary to the sales then those services may have to be counted as income taxable in the location performed, such as at the out of state customer location. That raises a possiblity that there was income reportable to a state or stated other than Ohio and NH.
Whether a specific activity or transaction has to be included as income taxable to a state depends on the particular rules of that state. This is also not usually a choice for the individual partner but is a determination that has to be made by the partnership based on the rules of the various states where activity occurred and the facts and circumstances of the activity as it relates to those multiple sets of rules. To further complicate these determinations, each type of state tax may use different standards within one state to determine "nexus". See, for example, the fottnote to the article Ohio Commercial Activity Tax: Nexus Standards at http://www.tax.ohio.gov/divisions/communications/information_releases/CAT/CAT200502.stm
As to what could have been done differently, one option would have been to have more than one entity with a separate subsidiary performing and reporting the income not generated from the activity in Ohio. Although additional organization cost, as well as separate accounting cost and multiple tax reporting would be needed that might have been a viable alternative so that you were not the 1/4 investor in an entity that had 75% of the income taxable to Ohio.
Based on the information you have presented on the organization of the entity, as the 1/4 investor in an entity that had 75% of the total income taxable to Ohio you would have to report 75% of your distributive share of partnership income as taxable to Ohio.
As mentioned, if your role was not as an investor/owner you would only report your income (as a contractor or employee) based on the rules of where the activity occurred.
I hope this helps to clarify for you. Please continue to ask if you need more help.