I’m going the LLC route but also want to see my local options (if any) for anonymity and inside/outside protection, or if I’m gonna have to contact out of state sources like Wyoming anyway to start the umbrella.

Again, they could be doing it for liability or asset protection or to better share the property, or because some guru told them they needed an llc.

Does anyone know if this would offer additional protection or if I'm better off separating out the short-term rental into its own multi-member LLC? 

But the loan itself, and the recorded mortgage note are a form of asset protection, as there would be little equity to protect in the case of a lawsuit and left after a forced sale if it gets to that.The other mentioned scenarios still apply (personal loan then transfer to LLC triggers DOS with all the possible problems; proper insurance is the first layer of protection, umbrella insurance second, proper property management is third and you should have those well established before more complicated asspros).Here are some diagrams that might help you further on this quest: Asset Protection Decision Diagram - to help assess the need for asset protection, and what to implement: https://www.biggerpockets.com/files/user/CosIorg/file/asset-protection-decision-diagramAsset Protection Onion Diagram - what, when, and at what cost one should implement in terms of asset protection - https://www.biggerpockets.com/files/user/CosIorg/file/asset-protection-onion-diagram-v2What is needed for complete asset protection OR the domains that need to be intersected to find asset protection

You don't really get any asset protection or liability reduction benefits, but having a proper business entity that you can get business checking accounts with, etc can help out on some aspects.

That is what will break the asset protection or company veil, it is also what will create conflict or lawsuits between members.

Parent child LLC setup is good setup for asset protection or not ?

You would use an LLC for asset protection or combine the two and get both.  

You can see if H&R Block still has something they used to call “audit protection” or insurance or some such.

But from what they have told me:Protection is the sameTax benefits are the sameI could be completely wrong, and I accept that; I haven't personally taken the time to read through case-law for the asset-protection or the IRS tax codes.Adam Adams