Late post, but I have just about every system in my homes. Furnaces, Boilers, Steam Boilers(What you use), Condensing Boilers, Heat Pumps, and Electric Baseboard. I do all my own labor on these systems when possible. I operate an industrial steam boiler at my work.
If you want a heat pump system and you want your insurance to accept it, you need to add baseboard electric into your home as a "Primary heat source." When you look at the BTU output of a heat pump is very small compared to your current steam boiler. They are not great at raising the temperature of a home, but great at maintaining the temperature!
Sounds like from what I have read you should just add electric baseboard just for the few too cold days and to appease the insurance company. Cheapest option if you want heat pumps. This option also lets you place heating on the tenants utility bill, assuming the meters are divided.
Probably your second most cost effective choice that is not a heat pump would be to replace the oil steam boiler with a natural gas steam boiler. If Natural gas is not an option, Oil. Either system you could direct vent instead of using the chimney and reuse your current radiators with no modification. The bill would be on you in this case, unless you bought two boilers...
I don't know why people like furnaces. Maybe the hot air makes them feel like its working? All that duct work and less efficiency... No thanks. I only use them because they are there already.
The gas room heaters might work if your layout is open and people are ok with cold rooms. If you need to install them in quantity you might as well install a steam boiler since the price tag will be the same.
Good luck! Let us know what you end up doing.
