Does anyone know if the mil instructor rating can convert over as well? i.e. does being a Herc IP translate to a multi-engine CFI? just curious

I'm not quite sure what you mean here. A military pilot cannot get an ATP without taking a FAA ATP checkride. There is no military equivalancy ATP like there is for commercial.

No, unless someone is aware of something different, you would need to complete all the CFI tests and take a CFI checkride even if you are a military IP. The only break I know we get is on the commercial.

Any type rating is helpful to show that you have the ability to earn a type rating. However, it's not going to make much of an impact on getting a job -- especially when you consider most applications have at least one type rating. So, if anything, not having one at all might hurt a little. All you need to do is take your paperwork over to the FSDO. I added three type ratings while I was on AD and each one only took a few minutes to accomplish at three different FSDOs. My experience has been that the FAA guys enjoy talking with military pilots, so it was never a hassle for me. If you came out of T-1s, you should have also gotten your BE-400 and MU-300 types when you did your military equivalancy CMEL/Inst ticket. If you end up going towards the fractional side, it certainly doesn't hurt you to have a business jet type on your cert. Unless you are trying to get on with Southwest, DO NOT waste the money on a type rating. Most places will not even consider them unless you have a certain amount of time in type. If you do go for your 737 type for Southwest, be sure to look into state vocational money for veterans -- my understanding is that some states will give you money for your type rating under "vocational training" programs. :-)

There is a notice of proposed rulemaking at the FAA that would greatly shorten the path to a CFI ticket for military instructors. Don't have time to dig it up right now..... just Google it.

If nothing else I can say that having a L-382 type on my certificate is a conversation item.... examiners always ask, I have even had a fed or two over the years who was a prior Hercdriver and it broke the ice in conversation while he was in the JS.