Nobody asked them to determine the "highest and best use" only a market valuation based on its current use!

After diagnosing the issue, noting that replacement parts weren’t available, and ordering a new microwave, we received a bill for about $660.

You will have to pay for an appraisal to and depending on what the value is it will be up to you to determine if you want to proceed or not. 

Ultimately, your ability to get a multifamily loan is going to hinge on the property's ability to support its own loan.

Appraisers are not going to add value for something that is financed or leased, and if you're the only house in the radius of comps with paid off solar they won't have any comparisons to derive value from it.In the end it is really only advisable to pursue if you're going to own the home forever....while it is nearly impossible to determine if you'll own forever or not regardless of present circumstances.  

Keep in mind that hiring someone that setup the STR may impact your ability to take advantage of the tax benefits.

Although one property will have negative cash flow, the ability to reinvest could yield higher returns across the portfolio.

However, if having your own separate home is your main goal, buying a personal home first might be better, though it could limit your ability to buy an investment property soon after.

I wouldn't go for a condo, as the HOA fees and restrictions could affect your ability to rent it out, and the resale value will always be lower than a comparable SFR.

In your analysis, look at local rental apartments to determine income potential of any properties of interest.