Since there is so much variation i'm fairly confused on which way to proceed.

I have a similar 1926 Spanish bungalow in LA (3bed 2 bath, 1300sqft, single level), that i just rebuilt completely, so here's my 2 cents1. with plumbing and sewer, make sure that you insect and assess the main drain line form house to street sewer - in houses of that age, they are cast iron and are often buried under a concrete driveway. if it needs to be replaced, make sure re-pavement of driveway is accounted for2. houses of that age have often started as 2bed 1bath and then somewhere along the way been converted to say 3/2 - mine was in the 70's. ask whoever inspecting the foundation to pay attention to the way it's laid out - variation in crawl-space hight, floor joists and different materials used for pillars that house sits on could point to an addition. flat roof over one of the bedrooms or bathrooms in an otherwise house with an attic is another sign it's been added. either way, check with the city that those additions are legal/permitted3. termite damage and dry rot in California and Arizona is a given - in any house, especially that old. as you walk around the rooms, stop in each corner of every room and jump up a few times - if the floor is soft and even a sign of weakness, i bet you you'll have to re-drywall, remove subfloor and repair floor joists in at lest half of that room. just a simple "poking wood for termites" test from the crawl space often misses that. i like my jumping test as well5. size and age of electrical panel - yes, but also age of main electrical wire runs is important. those are usually suspended in crawl spaces or laying on top of ceiling joists in the attic. old wire should be replaced as it's a potential fire-hazard surrounded by all the old fluffy insulation that's in old attics - speaking of fluffy insulation, i hear in some cases it could contain asbestos, so wouldn't hurt to checkfyi, just installed central air in my house and my best estimate - had 7 total - came through Costco at just under $7000 for a 3-ton Lennox system (heat and cool), all new ductwork, permit and inspections. curious as to what your HVAC bid was

There's enough variation that I keep mine 7 years.  

Or some variation of this.

If only one APN, then you will need a zoning variation, and from experience, they are no fun and difficult.

We have tried all variations of different date ranges.

The bank sets the rules of the game, & any variation from "their" plan can be extremely tough to navigate.  

I'm a little low to chime in, but thought this blog post I did may be helpful:  http://www.biggerpockets.com/blogs/4445/blog_posts...I don't think you can broadbrush an entire area with one class, there will be pockets to variation in each area, which is kind of the feedback you've been getting.

Not only that but you can give them a few different creative offers, the first could be seller financing, the second could be sub2, and the 3rd some other creative variation or maybe a lower cash offer.I'm curious if anyone has done this and could perhaps explain an example for how to do it successfully.  

Note that this wire came in variation where the inner conductors were encased in lead.