I see so many articles about the protective benefits of doing this, but my lender (and other lenders I've asked) say that residential mortgages cannot be held under LLCs (only commercial mortgages can), and that doing so can cause your entire loan to be called at once under penalty of foreclosure. 

It will familiarize you with the basic terminology and benefits.

Would there be any reason for me to not get an FHA loan and put down a bigger deposit, any benefits to that?

Others employ a BRRRR method or do wholesale deals/flips to have cash to invest long term. 

I think this would be more of a long-term hold for cashflow purposes, however it seems minimal to start, and I feel there is likely little to no appreciation with this property. 

Keeping each LLC’s financials distinct helps prevent this risk.Insurance: Having adequate insurance coverage for each property and ensuring it aligns with the LLC structure can also be a vital component of risk management.Legal Counsel: Regularly consult with your real estate attorney to ensure your structure and practices align with your protective strategy.In conclusion, while running everything through your holding company might simplify bookkeeping initially, consider long-term implications and ensure you are safeguarding each property and your overall investment effectively.

I think she still qualifies for a first-time home buyer loan/benefit in Connecticut but not 100% sure what those are besides lower interest rate and potentially less % for downpayment?

Each lender / investor will have their own guidelines in terms of reserve requirements needed on purchase transactions. 

A broker/agent representing a buyer needs to see things as a long term relationship and will  see if working together makes sense.

They focus on finding long-term tenants, and it's a win-win as less turnover is less expense for us and less work for them.