Wait, have you suggested an indoor kennel run? I know that is what I'll be using if any of my next dogs have destructive behavior/separation anxiety. They're just a large confined space.
Please suggest to your roommate to contact a positive dog trainer local to you who is experienced in behavior modification. (The term is "behavior modification" which includes special methods of training) That's really the best thing to do right now, since she doesn't want to rehome or get a crate apparently. I didn't read the whole thread, but it doesn't seem like finding a local trainer (NOT petco/petsmart) was mentioned.
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