I am extremely choosy about exactly how much work I want to do, where my property is located specifically, and many other characteristics of my investments.

Its not used because, and at least from my limit experience, I've never come across two investment that had such similar characteristic that I needed to get that level of precision in my measurement.

I'm also entertaining the idea of staying put and just taking out a big HELOC, but my fear of getting stuck in this house and town is significant.....I don't gamble at all, and I don't watch sports.

Does Rochester have any special characteristics which would make investing in ratholes better or worse? 

I appreciate your comments about providing ongoing education but it seems even this is a real gamble.... at least for the renter. 

I know that appreciation is a gamble, but if a city's economy is diversified and there is a finite amount of land in the prime location that is downtown/waterfront then chances are it should appreciate, right?

A few things to consider:R-2 will help, but depending on your current lot, some characteristics may still be "non-conforming" -- i.e. parking, density, setbacks, etc...

But of course that’s the gamble. 

If I want to gamble I go to the casino.

I'm utilizing both of those stock options and feel it is in line with my "gamble" on the company as a whole, if all goes well and they grow and show a profit, it will have been a great investment.