very specific targeted ads supply all my leads, end up paying around $2/4 per warm/hot leadedit: I also get around 1-2 leads via my website per month, those are all over the place though and not really scalable.

As you can imagine, electronic rent collection is very scalable, while driving around to collect rent is not.To address your questions:1) No, you can change how rent is collected - it happens almost every time a rental property is bought/sold.  

My goal:Build a passive and scalable business.

The beauty of your approach is that it is scalable, you can pull your downpayment money back out after your rehab is complete by refinancing.

It's not scalable for the type of business I want.

They do offer a more scalable solution than using Kwikset / Weisser Smartkey locks

It's not a scalable business model to swing hammers, show apartments, and screen tenants ALL on your own.

As you stated, the only scenario is a catastrophic lawsuit.There are other considerations if you grow the # of units, 1)  Personal Umbrella is not scalable. 

I'm only 23 and think that scalability would be a huge draw for me.

While I realize that it's possible to systematize the acquisition and management of small properties, it seems to me that the systematization of large commercial buildings is far less expensive and far simpler - fewer units, fewer tenants, more scalable projects, etc.