Carlos, I am from Spokane and I house hacked the first 4 years I lived here.  

She prefers they sell the house right now, as is, and live off their profit.

I'm assuming that this situation wouldn't pass inspection, but one could argue that all the spaces the guests have access to (i.e. bedroom, bathroom) are safe and habitable + the guests wouldn't be exposed to the kitchen.Also, do the city inspectors inspect other parts of the home the guests won't access (i.e. inspectors check the basement for water infiltration even though no guests would ever be living or even going down there). 

Tenants should be paying the owner.Do you also live in the house?

I want to prepare my home for renting, and my plans are to buy a motor home to live in for the time being.

You will be living in someone else's house.

There are exceptions, like what was mentioned by @Nathan Gesner, if you are an employee of the property owners, and you exclusively manage their properties, if you're a resident manager, living in the building that is being managed, or if you are someone who manages properties owned by a single entity and have a direct ownership interest in it.

I lived in Cleveland for multiple months and have some great connections to help you get started investing in Cleveland.

Right here on BP, in the BP Store:https://store.biggerpockets.com/products/lend-to-liveLend to Live is the bible for HML. 

This fall we launched 2 more syndications for infill developments in Boise. a 30+ unit Live-work townhome project in West Boise that has never been developed on 1.3 acres of land and an 8 unit lot split on the Boise Bench with a house to flip on an acre.