Or is it simply cosmetic or preventative or an upgrade?

If you had the money to close, there would be no worry of that, you would simply close on it yourself then.

Real Life: My client discovered that the PM company was $350 under market rent and allowed for an extra 2 weeks of turn time.

Yeah, each time we discover either a roof issue or a foundation issue.

You can pay the loan with ANY money, but you simply use your spouses income to qualify for the loan. 

At $700K for some of these 3 families, the numbers simply don't make sense.

I'm guessing you didn't go through insurance, but you should simply let your insurance provider know that you got a new roof (don't need to say why other than it was older). 

I'm located in the Southern California area...Orange county to be exact.I would love to see a copy of financial statements from someone in the industry, so I can simply see a example of what type of expenses & margins I can expect.. 

I'm simply looking for advice from people seasoned in this field and to try to continue gaining as much knowledge as possible.

For instance, in your example (btw, we have had multiple occasions where this happens in the past few years) if you paid $200,000 for the house, put $40,000 into reno, and then closing costs, commissions, etc. were $15,000 you would simply add all this up and that is your basis in the property.