If it's 203K, you Possibly could do some of the work, but you'd have to show a track record and experience in doing so.....and 1 or 2 cosmetic jobs wouldn't be enough.

What are the hot areas in Philly with a $45k budget for asking price, light rehab strictly cosmetic with results in the ArV being $135k to $150k

Cosmetic repairs less than $800.

For example:  a few years ago I was buying a flip house that needed only cosmetic work, and suntrust bank denied my mortgage because the appraiser noted that the house had writing on the walls, soiled carpets, and screen doors with screens falling off. 

(hind sight, it needed every bit of the $10K in work that they asked for, so I wish I would have done this deal)About 3 weeks later, I put it under contract again at $242,000, this time the buyers had a complete inspection, (which I now have a copy of)  which discovered the $10K worth of work (new windows was the major part, some insulation, a few reverse polarization plugs, and cosmetic repair in one unit)  that needed to be done.

It did need some rehab, but just cosmetic stuff and I expected to (and did) have it rented in about a month.Your buyer's inspections and the insurance companies inspections are unrelated. 

It's not a cosmetic/painting problem, I wish it was that simple.

They both want to sell the home quickly but it feels like i am getting a whole good cop, bad cop routine.

The house needs some work—mostly cosmetic—so I will be advertising to tenant/buyers that it is an "as is" offer.

You do the required cosmetic and deferred  maintenance the home needs to get it rent ready.