I figure it could be a good educational tool and potential for some additional income in the form of referrals, and my own purchase commissions. 

No income No doc . 

Purchasing your primary with this money, unless it produces income, will likely cost more at the higher interest rates of today vs what you have as a rate on this property.

3) since we will use a local property mgmt firm for marketing / bookings / rent collection, What business is the LLc in and what income and expenses do you report as those of the LLC (vs what do you maintain personally)?

Platforms like AirDNA and STRata.com provide data on rental income, occupancy rates, and competition in specific areas.

I've applied for a conventional loan: 3 units, owner occupied, NJ, 5% down.I have enough W2 income to cover the loan and additionally, there are two units rented already. 

You don't have multiple income streams like you would with multi-family The key is having the right local teams in place.

NO tenants, no repairs, no closing costs, no rent control just passive income for putting your money in a CD. 

Also maybe turning it into a two family home to maximize rental income is an idea.  

Right now the rental income covers most costs and I’m going to be paying 600 a month of my own money.