This means that if you want to add features that enhance the property but may not conform to the standard checklist used by appraisers, you may not receive the desired appraisal value.

(Yes - even for conforming products.)  

I have a legal non conforming property which, in the event of a fire, they need to know I can rebuild as is. 

There are many non-conforming alt such as asset loans, a stated type income where they go off your gross income.  

It’s helping me understand my options better.From what I understand, Fannie / Freddie do conforming loans only, whereas most SFH in bay area (in expensive neighborhoods) are in multi-million $ range so they are most probably non-conforming/jumbo loans.In Nov 2023, a SFH home in my neighborhood with a detached ADU sold in one week at 10% above asking price (3.5M -> 3.85M). 

Is this a legal conforming studio rental?

DSCR loans aren't subject to these conforming regulations (including seasoning) so you can do a rate and term, or a cash out refinance as soon as the project is complete.

Don't work with a residential lender, and find a commercial/"non-residential" conforming loan. 

First, let me say I made a mistake in not holding my standards with this tenant, I totally own my responsibility and it's a powerful learning lesson....AND, I rented a non conforming bedroom, and the tenant wants to be released from the lease and is threatening to report not having a big enough egress window.

It’s more about you and the asset than the bank if it’s a first position mortgage and conforming.