Good properties ARE cashflow positive, which IMPROVES debt to income, IF the mortgage math is being done correctly.We've done fannie/freddie conforming compliant loans on investment properties for unemployed stay at home spouses, only using rental income to qualify them.

Will this be largely non-compliant and open us up to liability?

If you give the impression you want to be as compliant as possible they will work with you. 

I am fully compliant with IRS SDIRA rules.

So, I'd say, study the law in your state and make sure your lease is compliant.

There is if you don't file taxes or don't remain compliant. 

THEY HAVE NO INTEREST IN THE PROPERTY and if the property  is non compliant yo can't event for non payment.....Also if you have a re-inspection scheduled do not under any circumstances let a tenant move out thinking you will get back pay.

One board member is concerned that doing this would change our HOA from being non-profit to a for profit business and would require us to become ADA compliant (historic building that does not have elevators), pay extra in taxes, higher liability, etc.

There are exceptions to the law, but it may not be worth your time jumping through hoops to make sure you're compliant. 

The real answer to that question is that the banks will do whatever they deem fit as far as portfolio allocation in order to remain as profitable and compliant as possible.