the more competitive rates are  6.9% for 20% down owner occupied, 780 credit score. 7.45 and 1 point for a duplex seems pretty solid.

There are some markets/small town in California still cash flow with short term rentals essentially if you can self manage and/or can do an owner occupied hosted rental.3) Stay put & sell the condo in the future to get a duplex that you can do a live in flip and house hacking one unit. 

Are all units occupied?

Make sure the rental is still occupied before you do anything else.If they are still there, hire an attorney specializing in evictions and start getting them out.

I understand an affidavit stating "I intend to occupy..." must be signed in order to obtain approval.  

The challenge going after them for damages is proving what occupied after you purchased it.

I bought a property six years ago where one of the units had been occupied by a smoker for over 30 years.

I assume you haven't occupied the unit in the past 5 years and don't qualify for any of the tax exclusion? 

Looking to buy a SFH in one of these counties, with the intent to convert a basement into an ADU and rent it out (short or long term) - and live in the main unit as owner-occupied.

The existing buildings only occupy the front portion of the lot, leaving about .4 acres of vacant land.