It was riskier than a quick cosmetic flip as it had septic issues, was on a busy road, only had 3BR (most in this area have 4) and needed some reconfiguration of space to optimize value.

In my opinion, one of the toughest balances in optimizing performance of a property is how high should the rent be.

Was making that (sub-optimal) decision a way to overcome hesitancy and fear?  

Paying them off early is sub-optimal if you can still acquire financing for the product you seek to purchase.

I was hoping to see some creative ideas like "AI leasing agents" or  "using AI to optimize electricity consumption and HVAC operations in an office building" 

Also whats the optimal dwelling coverage in dollars/sqft needed in snohomish County?

SEO - Search Engine Optimization.  

A good turnkey rehabber knows where the money should go to optimize the rent as well as minimize future maintenance calls.  

House hacking sounds like the optimal idea.

I won't go into the gory details, but will only point you towards this illustration of the mechanics if eventual mortgage free living is a priority for you (it is not for many, but is for me personally):http://www.gocurrycracker.com/the-go-curry-cracker...As you can see, there are lots of little tricks you can use to optimize and whatever best suits your needs and goals is what you should use ...