The easiest spot would probably be the dining room and change the office to more of a smaller dining area. 

Go with all wood if you can on dining tables and chairs etc.

We painted the inside, opened the kitchen/dining room, replaced windows, removed a nasty fabric lined black tub from the basement, replaced the siding and redid the bathroom.

The house is also furnished with a solid wood no spring couch, and a solid wood round dining table, and a king sized bedroom set in the master.

You should only have to do this with the largest items- mainly couches/chairs and dining sets.

I'm imagining something more like add a wall, turn a bedroom into a kitchen-living on one side and a formal dining room into a bedroom on the other side, maybe add a half bath in each unit.

Larger families, remote workers, or investors could see it as ideal, especially if local schools or amenities like parks, dining, or entertainment are strong.

It looks like one room is the dining room and the other may be a bedroom.If one of those rooms is a bedroom, you very likely have a roof leak.

I get CC offers on LLCs I establish within months of launching them.

A terms sheet will tell a pro whether you know what you're talking about and give them a structure of the deal you propose, but it won't establish credibility with respect to your financial ability to pull off the deal.