Zoning back then may have permitted such a use.Even if it is a non-conforming use now, which it sounds like it may be, once you demolish you will have to build to code, which might prohibit two structures on a lot.I would start with local zoning board and confirm the legal zoning use, because that's the one that will matter moving forward, and that's the standard you'll be held to as the current or future owner.

Do not try to operate it as a non-conforming rental.  

(even though many agents who work with buyers do have relations with buyers it is still open in nature)The Transactional Agent Bill is refering to is the role the Listing Agent conforms to when no other agent shows up.

Individual ownership provides a tremendous advantage because the individual can get a conforming loan, while a partnership or LLC cannot.

And of course 11 houses at once will make any conforming lender run and hide.Seller is refusing to allow me to cherry pick houses, understandably.Any ideas for how to proceed on this?

Non-conforming  (like is it a multi family in a single family zone, could impact getting a mortgage or rebuilding after devastating loss like fire, flood, hurricane, etc.)13.

I think the biggest thing is you might have trouble qualifying for a conforming loan.

Here is an example of a thread to get you started.https://www.biggerpockets.com/forums/88/topics/552883-ogden-utah-non-conforming-4-plex-purchase-4-bed-4-bath 

To qualify for a conforming mortgage on the types of houses I want (residential MFH) I will need to include rental income.

If you are in it for the long haul, doing it off the books would be ok, but then you run the risk of resale not being what it could be if it were conforming to the neighborhood.