Even good contractors miss things, and if someone is checking the work they will come back and touch things up that would have gone unnoticed otherwise. 

Since the room closest to the A/C unit was the spare room which he never used, the issue went unnoticed for a few days.

I think a lot of rehabbers don't realize that nearly every imperfection that they "believe" will go unnoticed will be exposed once the buyers home inspector inspects the property.

Thus, stachybotrys has immense potential for harm to health as it goes unnoticed and can thus keep producing lethal toxins without being discovered.

Likely that these issues will go unnoticed for a long time, but all it takes is one upset tenant to be a huge problem. 

Many things are more expensive on investment properties because the owner isn't physically there and things can go unnoticed or not be dealt with as fast as the tenants aren't responsible for the property. 

0-3 on sellers unwilling to fix inspection issues is a bit surprising because they will have to fix the issue to be able to sell regardless (except maybe the latest case where it went unnoticed during inspection and they are willing to not disclose it to the next buyer). 

plumbing issues are the worst, and if go unnoticed, can cause a ton of damage. also, are you paying top dollar (read:retail) for this property?

Hopefully being a good individual and trying to help him will not go unnoticed.  

If you proceed without permits 1 of 2 things will happen, 1 you skirt by un noticed which I highly doubt because now alot of municipalities actually have staff sifting thru the listings for renovations, they have realtors who actually give them previous listings of the property to compare and so on. 2 you get caught and now u have a pissed off Inspector, either he let's u go easy by having licensed contractors verify the completed work, or he forces you to tear all the drywall off and force you to expose all the work you did.