SOLVED:

So after taking the workshop with the bigladder folks, I've come to understand the underlying E+ structure and was able to deduce what's going on. Here are the settings for packaged and split systems respectively:

Package System (uses zone cooling capabilities):

• Inlet Air Configuration: ZoneAirOnly
• Compressor Location: Zone
• Parasitic Heat Rejection Location: Zone

Split System (does not use zone cooling capabilities):

• Inlet Air Configuration: OutoorAirOnly
• Compressor Location: Outdoors
• Parasitic Heat Rejection Location: Outdoors

As of 8/2/2016, it appears that setting HPWH to use outdoor air still creates inlet and outlet nodes for the zone equipment even though it no longer requires them. I would presume this is a bug. Anyhow, going into the OS text file and removing the extra inlet and exhaust nodes should cause the OSM to stop throwing the severe errors and produce a correct simulation.