The investor will not have any interest in the property, but will have a promised return of a specified percentage of the principle.

If that does not work then increase it in 5 minute increments until you find other opportunities. if I am hearing you correctly cash flow is your # 1 objective.

I got the $600 positive cashflow based on our monthly payment of $1600 (principle, interest and taxes) and being able to rent it out for $2200.

I can either get a 6 month extension (up to 2x) or I can convert it to a conventional 30yr principle and interest payment.The ARV I have is at a safe $108,000.  

I think it depends on your overall goals/objectives.

He argued it'll be paid down quicker, but I argue that I can just make extra payments on the principle if I want that and I won't need to worry about a commercial loan eating my cash flow either because it's my option as to whether I want to pay extra or not.

Had a call this morning from a fellow with two larger duplexes on the same lot, in a strong rental market and principle amount well under market price.  

They seem to have endless loopholes to provide the value on the property that they want.If all of the objective evidence available says that your property is worth more than the assessed value I'd just let it be.

Even if I agree with your premise that having a non-rounded purchase price makes the loan process more difficult (I don't cede this point at all btw because you have not provided any objective proof of its impacts) It is a minor problem at best, that any professional should be able to over come.

If there is money left over after all that, perhaps you need to do nothing.Paying more money to the principle just to get the deal to work is only artificially making it work.