We also have no other debt except the mortgages and we both have graduate degrees (thanks to basketball scholarships) so this is something we can really be adding money to.

The trust will own the assets for the next 10 years and it approximately $100k per year will be added to the trust during this time.

I like AirB&B, and due to my conversation with Al the other night, I WILL be adding a bike included in my AirB&B rental, or possible separately for rent, because it works very well with my location next to a beautiful lake w/ bike trail around it, and can take it to downtown SF quickly on BART to ride around, bike to downtown Oakland, etc.

You'll be adding and subtracting as you go. 

This is the minimum requirement for counting a room as a BR on the MLS.If it does, the next question I would ask is "How easily (read: costly) can a wall be added to make this into a true bedroom?"

Well, one way to look at it is to think of the value you’ll be adding to the property.

You'd simply be adding costs to the deal for no real problem that needs solving.But since many of us are looking to grow a little faster than that and likely don't have that much money in the bank, I'm a firm believer that using hard money is the best way to go for many buy and hold investors.

I'm new as well and would love to attend the Santa Monica REI meeting, @Jeff Greenberg may I be added to your email list as well? 

I have mine, and although I use it for investment purposes only, I have allowed my commissions to be added towards closing costs.

The second is the treatment of expenses while it wasn't occupied at all; you state that it was "ready to rent" but then made some repairs and maintenance - those repairs and maintenance would definitely be expenses when occupied by a tenant, but might have to be added to the basis (if the IRS doesn't agree with your interpretation of "ready to rent").