Put in a new support wall outside, new roof, fixed walk around porch, new HVAC system, 2 new bathrooms done in the historic style in one and not in the other, new water line,  new floors, fixed wall that was fallen 6 inches from second story to foundation, replaced termite damaged foundation beams, paint and cosmetic stuff, all new plumbing, lots more.

Removing the door will give you a a couple of more inches.

Water was a few inches high outside the basement windows during the storm.

If you decide to drywall, look into buying thin 1/4 inch thick drywall and place it right over the paneling.   

Storage of items in or on the premises: Items stored shall be at least twenty-four (24) inches from the heating system and the hot water heater.

But for a moment, let's work under the assumption that the foundation is in good condition and within tolerance of being level (usually 1 inch). 

And just like the repairs, they're not budging an inch.

To solve the problem when people want to close their bedroom door when they are sleeping we cut one inch off the bottom of the door, install a vent in the wall above the door so air flows into the hallway and we even cut holes in the ceiling and install registers with filter so the warm moist air rising to the ceiling can flow into the attic.

That said you have to have something to attach the 2 x 4 s to every so many inches whereas with a drop ceiling you only have those wires.

There are places near Modesto where you can but 200 acres of beautiful land with a lake front for something like $135,000 (if I am correct), and I have a friend who looked into buying the land, but the cost to bring in electric is insane and then you neeed to dig a well and install pumps, storage tanks and even 4 inch pipes for fire hydrants.