@Jay Ben, the class rating system is generally subjective.For properties: things like age and amenities drive the rating.  

Here's a bit more in detail about how rates are calculated for DSCR loans:1.

As for house-hacking an existing quad, only putting 5% down in this high interest rate environment will almost certainly mean you won't be "living for free" as is the point of house hacking.

The unfortunate thing here is that investment properties foreclose at a higher rate than primary homes so many banks just don't want the exposure to this.

You could do an 80% LTV cash out on a DSCR loan, however you will need to be able to debt service at the higher loan amount and rate to qualify.

Lately with interest rates being higher and inventory being lower I've found it harder to find deals with significant cash flow in an area I want to invest in.  

Personally, I like Cobbs Creek a lot, but the areas depend on your price point.

However, there is often flexibility for non warrantable ones too (depending on the reason).

Depending on your relationship with your parents and everyone’s expectations it might be better to have them be simply a lender on your first deal.

As always it depends on the deal/project you're working on.