At the end of seven years, the interest and principal is paid back and I have effectively manufactured $60,000+ in cash. 

The metric to measure whether it works or not is the CONVERSION RATE, not whether or not a deal was made.If your conversion rate is 0.03% (like it usually is for DMM), spending more money to get more mailers out does NOT change the effectiveness of that strategy.

If the walls were damaged enough to require patches as opposed to just filling small holes or if an entire wall or the room needed to be repainted entirely then I would charge for that.

House hacking is definitely the simplest and most cost effective way to get into the market if that works for your situation.

First of all - most people (including real estate investors) are lazy and will always gravitate towards promises of quick returns / passive income promises.But also - what you are describing is something that AirDNA does extremely well and automated - it can be a little pricy, but way way more effective and accurate to do this with that tool - highly recommended

If separate, is GP taking the 20% split + their share as 10% LP or does 20% include their 10% equity (effectively equating to a 10% GP bump)Loan guarantor fee and dispo fee is a little higher than I have seen many other deals.  

I would also like to know what effect business structures have on taxation (LLC/ LLP/ LP).

The “tales” of nothing down/seller subordinates “down payment” done successfully almost always hide the most important information - that the buyer either provided additional collateral (such as real property owned “free and clear”, a certificate of deposit in an amount greater than the down payment required, or the buyer is financially strong enough that part of the financing was in effect a personal loan or line of credit. 

This scenario requires a confluence of events:- Significantly Negative CF- Insufficient reserves relative to negative CF- Overpaying OR Market DeclineThe personal guarantee just opens the door to the damage from the above situation overrunning everything.

A couple of years back I read an article regarding what was called the donut effect when it came to major cities.