4- Finally what price range / square meter / type of property (house VS Apartment) would you look for. you as an investor that will appeal to the Market. 

Moreover, I assume the utilities are not metered separately.

I am wondering if I should keep the water meters in my name and get rid of one water meter and let each meter service 2 apartments?

Now as we started into the work we realized the exterior meter base (10 meter base) is all rusted and will not pass inspection.

talk to the dept of health first (records requirements etc), establish what upgrades/maintenance required, line up a reliable repair/handyman/type person, consult lawyer, and then make your offer, see if you can buy the land it's on via lot line adjustment (ideal scenario). a lot to be aware of, such as system upgrades or county code changes bringing in the requirement to add metered connections to an older small system, for just one example.Otherwise- owner doesn't want to manage, I doubt you really do either but could be wrong. 

It is going to cost a bunch to separate the electric meters and make it two units.

However, you are looking at separate electric and water metering, maybe gas too?

And I was also told no gas appliances in an ADU so it would only be the electrical meter.

Are they on one water meter or 4 separate? 

Water/ power metered ind.