There is a "professional office" in a storefront two blocks from my office that I believe is just a guy's house. In my exploration of doing the same I found the following problems:
- no lease protections due to the lies you need to tell in order to get the commercial lease
- vermin issues in ground floor units (not bad until you need to store food and have bedding or clothes around)
- lease terms that are usually much longer than a residential lease
- lack of a shower in many commercial units (fixable but adds to the cost and may tip off a landlord)
- generally undesirable living situation (poor ventilation, light, loud businesses next door, layout)
- expense - these units are cheaper than similarly sized apartments, but they aren't usually cheap enough for one person alone, and the floorplans usually don't make for great roommate situations
I think it would work really well as a pied a terre though, if you have another place close to the city and can afford the commercial unit. Sleeping in your office is totally legal and does not run afoul of most commercial leases. Using it as a residence violates the lease.