I have a short sale (listing) that I'm working on now. Chase just completed the appraisals and I'm waiting for them to approve the price. If you are considering a short sale, just be patient! In this case, the bank doesn't have any stipulations on who buys it or what financing is used. It's just a matter of price right now (I'm speaking from a listing agent perspective in Texas). Typically there's no required holding period unless you're looking to sell it FHA after it's rehabbed. To offer it to FHA buyers there is usually a 90-day seasoning period. If your rehab takes 90 days then you don't have anything to worry about there.
I'd say if it's a good deal and you've got some patience...go for it!
In this listing that I have now, I'm waiting for the approved price before I move forward with a contract. Our market is SUPER hot so it won't be an issue to sell it. However, many agents will collect a bunch of offers first before they have an approved price and present it to the bank to see what they. Not sure how it works in your market but hopefully this gives you a rough idea of what to expect.