On the other hand, some people say if you have a true deal, the investors will come..which is true. 

My agent states there is no true ARV for the neighborhood, therefore, we have to work off "as-is" value of 113K-120K.

Is this true?

Here in chicago for 2-flats I absolutely make sure I have equity in the building because there are more sales meaning more of them in the market to unquestionably tell me the real value.Every market is different so these assumptions may not hold true for 3-unit buildings in other markets but I know they are extremely popular here in chicago and easily sold even if they have some negative equity.

That's true of any profession though.What I have found though, is there are enough good ones...let me rephrase that, there are enough great ones, for me to agree 100% with what @Rod Desinordjust said above.The key is to understand that every agent isn't "investor friendly" simply because the have a license.  

@Curt SmithI'll make a really broad statement, if you do want to do one or two sandwich lease option deals a year it's not a big deal as far as being licensed, this is only my opinion but I think most "departments of real estate" could care less of 1 or 2 dealsThe big point I'm trying to make is if you want to do 50 to 100 of these deals a year, there's no way around not being licensed in most states because you're acting as a major business operation, there is a pattern of similar business activityAnd I've said this over and over, all it takes is for you to get a negative reputation at the department of real estate in your state which will stain your reputation from being licensed in the future; all it takes is one real estate broker to write a letter to the commission and now you've got headachesIt's prudent just to get licensed and build a business you can be proud ofA sidenote:  I think a lot of people on BiggerPockets think that if you are licensed it stops you from doing creative deals,  that's not true at all.Regarding sandwich lease options on nice houses in nice areas, Dodd Frank excludes your relationship with the owner as an investor, if your subleasing and sub optioningI think there's a great opportunity for you getting rent credits and doing creative contracts with your owner as an investor with sandwich lease options, but don't be broke and not have some reserves like 3 to 6 months in case the tenant buyer doesn't pay you when you sub option and subleaseAnother issue is be careful of who you let into the house and make sure the tenant buyers  work on their credit and save money for down payment and they truly want to be homeowners.

However, I was one of the Carlton Sheets "victims"  I was a too good to be true package and I walked away before I started. 

True deals will sell themselves! 

I dont know if this is true, it is just one of the explanations Ive heard.

This will show a true equity value of the property when you are done.Since you are trying to do this with nearly zero money in the game you will need to step cautiously.