The property is not guaranteeing the loan (besides as collateral), only you personally. 

I was wondering if there are any loan products that allow me to use my current house as collateral for my next house.

Moreover, these are unsecured loans where LC doesn't have recourse on the property if you were to default (just screw up your credit)Personally, I would just go with fixed loans at much lower rates and safer collateral.

Of the Three C's of Credit: Capacity, Character, and Collateral, perhaps the most important is Capactity...does the borrower have the ability to repay the loan?

A few may offer Asset Backed Loans (ABL), which uses the duplex as collateral.

Also was "open to a discussion about going up to 100% LTV if they could collateralize something else for an extra 20-25% like an investment portfolio so that a buyer could achieve even higher tax efficiency on their borrowing.

Hard money lends on rehab as well, if property is paid off they will happily collateralize the property (as long s it's worth more than the rehab) and give you the loan with no money down. 

This is the only financial vehicle that a person can use dollar for dollar as collateral for a loan.

There is no political collateral to be gained by bailing you out. 

Because I would think if you are collateralizing the rental property and need a second lien against it, that small bank would want their real estate / mortgage underwriters involved.