Plus, maybe up to half of the wood of the walkway is still in usable shape (other than the horrible layers of cheap paint).

Knowing the building process is vital but using a hammer isnt. 

You probably might also consider putting the house in an LLC to put a layer of protection between you and potential tenant liability.

The GC did go above and beyond the normal GC duties on the project, and he was absolutely vital to the project.

Further more the finance part adds an extra layer. 

If what is underneath is compact enough (looks like a gravel base) I'd slap another layer of asphalt right over the top, thickening up what is there now and filling in the bare spot up to the level of the rest.

(I may have missed some vital detail)...

It doesn't look too bad, but one problem is the roof : layers of asphalt shingles over old wooden shake shingles.  

Right now I am looking at Aker CM-60 fiberglass for around $420Aker ACCTS-3360 acrylic for around $800Delta 226032AL00 "Acrylic" $500 (although I've heard that it is just an acrylic layer over other material).Any suggestions of different units or recommendations of things I should be avoiding?

If you want to have the privacy, you could opt for itched or one way glass that will let all the light in while keeping the privacy maintained.Using The Right LightsThe placement of the lights plays a vital role in the lighting setup inside the house.