A reasonable summary and some fair points. It should be noted that we still know little about the 'fact' that some neighbours have found the nursery to have a negative effect on their quality of life.

By the letter of the covenant none of your scenarios are permitted - which seems ludicrous in most residential areas, especially in London.

Planning permission surrounding commercial activities and 'dwellinghouses' may be needed if:

• the house will no longer be used mainly as a private residence. This is the key test - has it become business premises first and a home second?
• the business activities will lead to increased traffic or parking in a residential area.
• the business involves any unusual activities for a residential area.
• the business may disturb your neighbours at unreasonable hours or create other forms of nuisance, such as noise or smells.
• you need to make major structural changes to your property, altering or extending it.
  

On this basis I'd suggest (3) would definitely need a planning application, (4) probably wouldn't, (5) would depend on the number of cars (either way, they cannot be advertised for sale on the highway) and I'm not sure on (1) and (2). I cant see why 1-2 wouldn't be granted permission, nor 3 if we're talking about 3 B&B bedrooms. 4 exists in so many instances around the country and 5 wouldn't be allowed in a commercial sense but you can buy and sell cars privately so there would be trouble taking action against it if there were never more than a small number in the street and they didn't have for sale notices in them.

Bottom line, all of those scenarios exist in very similar or the same form in residential areas throughout the country and in the majority of cases without significant conflict. Mainly because it is about balance, the LPA would not allow a residential area to become commercial by allowing every planning application.