The code doesn't seem at all against the idea of living off the grid, only that living itself must be up to an appropriate standard. I think, at worst, the code might be used and interpreted by the city to fight people living off the grid. If she is living all hunky dory, instead of faulting her for simply not getting approval first, it should only be right to fault people for living off the grid only after a review determines they do not meet the standard.