1) I don't recall a way to have PS write "estimated" for this.  Absent something I'm not aware of, I would attach a preparer note disclosing that you're using an estimate.

2) I agree with your analysis.  The exception for kiddie tax would be if the student had earned income in excess of 50% of support (IRC 1(g)).  It might be worth going through a support worksheet, I wouldn't rule it out completely but I think you have to include FMV of rent in grandma's neighborhood as part of support.

The point of the estimate is to just to determine the parent's tax rate.  Your client might be able to make a guess at this.  Hint: most of the deadbeat parents that I've seen don't make very much.

Rick