Lets say I do season long enough to take advantage of the full exchange, are there guidelines on the value of the new dwelling I am purchasing with that exchange?

Instant value add if the community will support it.

I got a house sub 2 this year, I only did it due to instant equity, ok cash flow and I think I can refi should I get called. 

@AlexGallardo FHA 203k Advantages: Creation of instant equity3.5.% down of the purchase price and the rehab costsCan be used for primary residence with 1-4 units (could also be looked at as a disadvantage)  When using 2-4 unit property, projected income from other units can be used to qualify 6 months' worth of mortgage payments can be rolled into the renovation budget if the house is deemed uninhabitable by the HUD consultantCredit scores can go down to 600s (lender dependent) DTI can go to as high as automated underwriting system allows (typically 56.9%)Allows you to buy a property in any conditionCan use it to fix minor repairs all the way up to basically a full tear-downFHA 203k Disadvantages: Interest rates tend to be about .25-.5 higher than regular FHA loan Additional costs include HUD consultant fee, inspections, title updates, and supplemental origination fee (Cost of doing business, but this is built this into your numbers, so it's no big deal)Must use a licensed General Contractor for a full 203k or up to 3 specialized contractors on the limited 203k Must hold onto the property for 1 year and live in it. 

The Wind risk is part of the Property Insurance (homeowners, Dwelling/Fire, commercial package, etc.) . 

This includes an umbrella policy in addition to insurance for the dwelling. 

For named storms aka hurricanes you should expect a high deductible set as a % of the dwelling or unit coverage amount.

Andrew to be fair I think the buy a house with instant equity ship has sailed unless they are like you and these investor reside there have the ability to source pay cash hire their own crews etc and thereby EARN equity..

CA enacted the Accessory Dwelling Unit law that says any SFR can have a 1200sq/ft building as an ADU, and I called the Assesors office and he said I could most likely get one of the buildings coded as an ADU BUT that may require ripping out the 2nd kitchen in the 'main house', which is a deal breaker.

ADU - Accessory dwelling unit.