Families want safety and a big house, so they are willing to pay top dollar. 

It also took me down the rabbit hole of the safety of escrow deposits which seems quite frightening.

It's like asking what the best food is.

The primary benefit of a smaller  renovation is you'll have a larger safety net if the renovation gets out of hand, the property won't sell, or if it takes longer than expected to rent.

I remember the reports of the first cases coming out from Wuhan in December of 2019 ,and obviously since everyone knows there are only 4 comprehensive bio safety level four laboratories on the planet, Moscow, Paris, Fort Detrick-Maryland and of course Wuhan Institute of Virology, and given that there are over 100,000 small town with wet meat markets throughout China, one doesn't even have to ask the question "what are the odds?"

I'm only seeing one rule (safety). 

That is a safety issue.

At one point she even said if the hotel doesn't provide kitchen then I need to pay her $500 just for food for 6 nights.If you were the landlord, what would you do? 

It's because you didn't get rid of all the food and drinks left on the studs by the electricians and plumbers, before the sheetrock crew does their thing. 

Food for thought: it is easier to get a loan of any sort on the owner occupied part, to include HELOCs.