However, there also seems to be evidence from committee meetings supporting short-term rentals being authorized in historic neighborhoods like mine as long as guests adhere to a 7-night minimum stay.

How will appraisers, lenders and tax authorities account for this? 

To be fully city compliant  you must have an "authorized property" manager that lives in The City of Cleveland if you are out of state.

What is the minimum interest rate we can charge for the seller financing without causing any red flag with the authorities?

.- lower turnover- easier on the units when they do move- quiet and less disturbance than traditional, younger- for fixed income, consider partnering with the local housing authority for SEct 8 vouchers, then raise rents accordingly - guaranteed money & the Sr. only pays a portion (if they qualify)Traditional renters- Higher turnover- Higher turn costs- More volatile - higher bad debt- More drug related activities- Adding in children that are hard on units- Higher eviction rates and legal costsConsider all angles before making a decision with the changes. 

She doesn't own the property, under what authority does she have to issue leases?

I've been seeing: AS-IS contract, Sub to addendum, Authorization of release, power of attorney.

And I maintain that IRS Publications are not an authority for anything and contain multiple errors.

Now today on the 20th at 130pm with a close tike of 3 pm, the underwriter decides that they don't like that because I'm so young and so fat have only been an authorized user on a credit card (having been renting and paying for utilities for a year though) and haven't been making the payments, that now I would need to have a cosigner (which doesn't really work since everyone I know have too many write offs) so now I'm in limbo while I wait to see if there's any other solutions.

What you always want, in any eviction before any district magisterial judge here in my area, is a clear open-and-shut case where you are obviously high on the Mountain of Right, while the tenant is deep in the Valley of Wrong.But I don't operate out of Dallas and I really can't tell you with any real authority what's best there.