I was looking at those two formulas and thinking to myself this seems a bit excessive for rental property investing, thanks @Bjorn Ahlblad! 

You can get an Excess or Umbrella policy that provides additional coverage. 

Buying out of state is fine you will only have an issue if you go with a lender with overlays or requires landlord seasoning.They may question your ability to manage the property if you are out of state in terms of excessive mileage away.

No issues with shower windows, in fact the window can be a benefit to excessive moisture and potentially mold.

If it 'fails' or would be excessively expensive to repair, you can just back out at that point and forfeit your EMD.

If there were any excess rental loss (not used up in 2019), can it be carried forward to 2020?

You may also be able to purchase excess coverage above that.3. regardless of how the property is insured, pay attention to the Loss or Rents or Business Income coverage to make sure the amount is adequate to cover the rents.  

I also know some folks that do get a job but will excessively spend their money which makes them just live day to day. 

You guys could also explore having her put your funds to work, if she has excess demand beyond her current stable of private funding sources

Here's a breakdown:Taxable Income Calculation:The portion of your rental income that surpasses the combined sum of depreciation and deductions contributes to your taxable income.Tax on Excess Rental Income:The excess rental income is subject to your regular income tax rates.