I am not spending $40k on their next step, but this looked like a good investment ($1500 and a money back offer).

I’m currently looking at investing in Cleveland where you can get up to 30%+ COC returns, and a bit into Columbus OH where appreciation is big as well.

For example, I am a little concerned about some aspects of the business cycle recovery and a potential for a double-dip so I lean toward the safest part of capital stack which is debt (or low-debt equity).

IMHOThere are more international students staying, I've seen it where I work (at a university), but many of the newcomers are not students and a country our size can't handle that many people in a relatively short period of time. 

Also, while you can get up to 80% cash-out with a 720+ FICO and a 1.0+ DSCR I don't see why you're being capped at 70% LTV currently. 

If you have a plan A and a plan B going in you are setting yourself up to fail right away because you have told your minds already it won't work so you won't put your all into plan A.

Looking for guidance, networking and a path forward.

you can likely buy a small multi in a great neighborhood and (i'm making this up) if it has a 4 BR and a studio, you live in the studio and rent out the 4 BR.

Good luck with it I am sure you will do very well since your experience is at both ends being a flipper and a lender. 

The appraiser will provide a rent survey and a rental amount that will be used to structure the loan- more on that below.