And you also have to consider that your exit strategy will be compromised since other investors aren't going to want properties in weak rental areas.

Compromising your ethics isn't wise. 

Replacing the microwave appears to be your least expensive upgrade IF you actually wanted appease your tenant with a compromise based on his requests.

A compromise would be Murray Hill...not trendy like Riverside but pretty decent and plenty of MFH options.

I understand that flippers are in it to make money, but often times the quality of the flips is significantly compromised because corners are cut to increase profit.

Unless the executor is drunk that day, or you have pictures of him in a compromising position, it ain't gunna happen.

.$1,450/mo rental rate with 1 month vacancy (for turnover, repairs, etc) = $120 per month (1450/12)$1,450 - $120 = $1,330.Therefore, if you can get them up to $1,350, that would be an excellent compromise as it gives you MORE in cash flow than moving them out and having it sit vacant for a month while you turn it over in order to get the $1,450. 

Compromise a little cashflow but really amp the returns? 

 #2 is a good compromise, but there is another option IF you are planning on living in this house for at least a year.  

Never compromise your standards for any applicant.