If I were to do this, (and assuming simple numbers), Is it:- pay an architect / engineer out of pocket to get a good plan for the property (maybe like ~$10k?)

Would you mind sharing your contractor/architect information?

Mechanic and car dealership are often not in the same category.You need a site plan and constructions plans from an architect first.Then you can get bids.You'll need more than just plumbing, electricity stubbed out, if you will run any outlets.

We also have a prior relationship with the architect and like the design.

Architect, which is easiest way to get the permits, ~$10k.  

Can anyone recommend a good architect that can tell what it would take to legalize it? 

We had to move out tenant, they had to hire an architect, get plans and go through the whole process.

Those types of buyers usually need longer timeframes to do soils, environmental, deal with planning/building dept/public works, etc, not to meeting survey, engineer, architect, etc.

Building a coachhouse in the back is roughly $200k minimum from the architects that I have spoken with. 

I have one at 45 but he can do all the work for me -- from architects to subs to project turnover-- and has built a 80ksf strip mall, too bad he is only on call, since his price is steep, but he is there if i need him.