What would you do if you found a C- or more likely D very small triplex or duplex in pretty much in the heart of Charlotte?

It is a C or C- neighborhood with $550 gross rent per unit.

Usually (but not always) if you buy in a C neighborhood, you will get C or lower tenants. 

There seem to be tons of people, investors and people looking for a primary residence.

If it is a C+ or approaching B class finding better quality tenants may be easier than falling back on S8.

Since you're remodeling anyway I'd get a price to run the vent outside and do that if possible unless this is like a C or D property and you're trying hard for low, Section 8 compatible rents.I prefer them ran outside.With that said, no one has ever complained about ductless vents to me.  

The 4-plex and multifamily properties were in C or D neighborhoods and looking over financials were cash monthly rent payments, with late payments and maintenance issues, higher crime, more run down properties on the streets, etc... 

Does it make a difference about the income being on a Schedule C or E if you're being provided a no doc loan, which I was under the impression doesn't look at your taxes.  

Take me, cor instance.

Your best bet on a fix and flip is to use a private money lender or a hard money lender.