The self rental income is not passive and so passive losses are not netted with the passive rental income.
"LAW: Under Reg. § 1.469-2(f)(6), if a taxpayer rents property to a business in which he materially participates, net rental income is non-passive. Stated differently, rental income from self-rented property cannot be used to trigger allowance of passive losses on Form 8582. This rule does not apply if there is a written binding contract entered into before 2/19/1988."
IRC section 469 provides all the passive loss rules.
These rules do apply to C corporations as well as other entities. See, for example, the article at http://www.journalofaccountancy.com/Issues/2001/May/SelfRentAndPassiveLosses.htm
"Regulations section 1.469-2 (f)(6) reclassifies as ordinary any net rental income from a lease of property to an activity in which the taxpayer materially participates. Regulations section 1.469-4(a) defines taxpayer activities as including those conducted by C corporations as well as pass-through entities. Both regulations were issued under IRC section 469(l), which authorizes the Treasury to issue regulations to carry out the passive loss rules."
Please ask if you need more discussion or clarification.