Price is rising and at one point, it's smarter to sell (even if you leave some money on the table) vs. go through another real estate market crash.

I understand that Calgary is at risk of having its housing bubble burst (which could go in my favor) due to falling oil prices and rising unemployment (may also be good to pick up some distressed property owners!)

This is key since it removes most if not at least 80% of the risk immediately.Cost of obtaining + UPB of the first must be less then BPO or what you find on Zillow.So considering those first two, if we believe we have an property in an area that will rise in price and/or foreclosing will result in a positive outcome. 

Honestly, I'm not sure how much longer my wife and I will be here (looks like my job might be taking me away), so I'm not sure how much actual investing (if any) we are going to to get to do here, but one of the big problems we have been running into is the inflated market.  

They know that the stock market is considered to be a "gamble" and a rise/fall does not affect their overseas real estate decision making. 

Can your family income withstand any shocks (say, 2 months of vacancy, or, a new roof, interest rates rising to say 5%, or something similar).

The map found on the link below shows where rents are rising and failing the fastest in the USA. 

Where rents are risingThis map shows where rents are rising (and failing) in the USA

There is a garage with kitchen and appliances aka 'guest house' potential rental as a studio , currently is not rented but potentially could be for 450-500 with some tiling and flooring fix.The electrical of the garage is tied to one of the unit.Need advise in following:- How would you approach the possibility of renting the garage: owner pays bill for both and rise the monthly rent?

In my experience in this current market and across the country, if your offer price is not at least 80% of the ask price (this assumes the ask price is at or below value and not extraordinarily inflated above that), then it would likely get filed in the circular cabinet (trash can).