You shouldn't see any dust, just want to ensure the coating will adhere.Apply two coats of FLAT (mutes blemishes) solid latex stain by 3" brush first trimming out edges and casings then rolling vertically with 1/4" nap roller cover.

The two most concerning blemishes to me are the lack of verifiable income and the outstanding debts.

You want a tenant that knows how to manage money and will not resort to bankruptcy to default on her debts.You would only rent to someone with a serious blemish such as that if you are extremely desperate and willing to take a risk. 

.- They respect the law and do not want the blemish of civil proceeding to appear on their "record."

If the tenants already have subpar credit reports, why would they care if another blemish is added? 

I am not saying that.. there are many ways to structure deals that don't need to have securities or PPM's issued.. but if your putting passive investors that you don't know into a common enterprise that you control then that I think is the definition of the HOwrey or HOwie test.. and I did get stung on that one personally by the state of Oregon department of corporate finance so I am sensitive to it.. my only blemish in 44 years.. there are other ways.. to structure these..  

:Class A Properties:Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Vacancy Est: Historically 10%, 5% the more recent norm.Tenant Pool: Majority will have FICO scores of 680+, zero evictions in last 7 years.Class B Properties:Cashflow vs Appreciation: Typically, decent amount of relative rent & value appreciation.Vacancy Est: Historically 10%, 5% should be applied only if proper research done to support.Tenant Pool: Majority will have FICO scores of 620-680, some blemishes, but should have no evictions in last 5 yearsClass C Properties:Cashflow vs Appreciation: Typically, high cashflow and at the lower end of relative rent & value appreciation.

But let's just say 80% of them were fabricated, 15% of them were way over dramatized due to taking a close up of a minor blemish and making it look big.  

Any blemishes?

As a regular attendee (and that is my only affiliation) I wholeheartedly agree with her on that.I assume it was an honest mistake but wanted to clear that up before any blemish to Ann's reputation would occur.