I am looking to connect with the investors there as the promotors are continuing to take Asset Management fees to the tune of $450K a year (on top of PM fees) even when their payout to the investors is around $20K a quarter (not meeting preferred) and the overall fund is negative about $450K.

You want to be understanding and not "kick them out", but at the same time let them know you operate differently than the previous owner and if they would prefer not to operate that way that's a decision they can make.

The buyers are FHA-qualified, and I mentioned the option of switching to conventional, but they prefer not to.

If they seem agreeable, then you can ask if they would prefer to cut the cost down the middle or would they prefer to purchase the supplies and you will assume the cost of labor to install it. 

And while you get upset, sometimes you have no choice but to close with bad terms, or forfeit your EMD.

Someone mentioned wanting to be within driving distance of a property, but I actually prefer not to be close.

Since you won't be able to recognize it as a valid rental if you're charging under market rent and you also expect to be covering any house expenses that are outside of her budget, this seems the best choice. 

Or if they would prefer a lease option? 

I would check and see how many 1 bed and 2 bed options there are and what they are priced at because most folks will prefer the full place to themselves so rooming 2 people together could make getting bookings a bit more difficult (not always the case but something to consider)

If I have to buy a last-minute ticket or spend $1,000 or so for notarized signatures at a consulate, then it has a significant effect on my choices.