I would suggest making sure that you are following a set format/style of house each time you flip to systemize it more2.

Is it better to keep adding equity by doing work on the houses while I'm renting them then refinance to recover the initial down-payment to reinvest into another property or to pay down the heloc?

Incorporating a washer-dryer hookup in the main house could be advantageous.This addition not only increases the convenience for potential renters but also adds value to the property itself.

I and my spouse are planning on buying a small multifamily and house hack.

All major flippers in town have heavily compressed ARV to accommodate for the potential of the downward slide to continue.

They get a higher return since they are covering housing cost, have the $250k per spouse primary residence deduction in gains, is a savings account, higher leverage position, lower interest rate possible, will pay more premium for location, etc.House might be overpriced for REITs but not for home owners.  

I have investor friends in LA area offering temporary free housing.

If I were you I would look into the possibility of starting off with a house hack.

A house that's similar, but 10% larger than another usually isn't worth 10% more.

Any general advice is much appreciated.You should house hack to start.