There were charlatans selling this stuff and not disclosing the requirements and many folks ( including me) got audited for those purchases..

You have to audit all of their accounting because inevitably late fees will change every statement, utilities are sometimes billed back (or not at all), and god speed if you have a delinquent tenant.

If you think of audit-proof as avoiding an audit - then no.

Some great resources would be here on BP, passive pockets, SEC edgar site (for example you can review Regulation A fund offerings as well as their financial statements to understand how to read audited financials).

Yes, it is like auditors and many of the auditing companies do this.

I would also do a lease audit to check for delinquency, and how many of these tenants were just leased to, and how many are actually paying.

You can also do an audit of your “hotel” to see how it compares to others in your market in terms of design and amenities to fully maximize revenue.

They have much stricter reporting requirements (audited financials and semi annual reports), as well as a much lower barrier cost of entry.

It's true, Banks and Credit Unions will not provide DU's as they are audited much more than brokers and lenders. 

You will spend $10-$20k to put the PPM together and then if you do audited financials that will run you five figures per year as well as tax returns are not cheap with all the K-1's.