What's the difference between commercial and residential tankless water heaters?
Safety vs. Efficiency
The residential models have a default temperature of 120 F and a maximum of 140 F. This compares well to a typical residential hot water heater. The concern is that if the water is too hot it will cause severe burns. That can happen even at 140 F. Here is a chart of water temperature burn times.. At 120 F you're &quot;safe&quot;. At 140 F it takes 5 seconds to cause a severe burn, which is bad but allows a chance to go &quot;oops&quot; and get out of the way in time. At 185 F you essentially burn instantly.
Why are the commercial systems allowed to run so hot? Because they are used for space heating (which needs very hot water) and because there is an assumption that there will be people actually installing and managing the system in a safe way - e.g., installing appropriate temperature controlled mixing valves or adjusting the system appropriately depending on the actual use. A typical consumer will be more likely to mess up. Sad, but true. Plumber installs it and sets it to 120 F, customer decides they want the water hotter and instead of cranking it up to 140 F (hot but manageable) they go to the top at 185 F. Then, from the comfort of the burn ward, they call their lawyer to sue the plumber (for not instructing them what to do, even though he probably did), the manufacturer (for not warning them, even though the heater came with a big red warning sticker), the water company (for delivering H2O that could handle that amount of heat), etc. Too many lawyers. The manufacturer has an easy way out - limit the residential heaters to the traditional max. of 140 F.
So why can't you use the residential system at 140 F to heat your house? Because it won't work very well. Heating (and cooling, for that matter) depends on:

Difference in temperature between the supplied hot air/water/etc. and the ambient temperature
Rate of transfer  between the supplied air/water/etc. and the room air

You simply don't get the same amount of heat out of pushing 140 F water through pipes in a 60 F room that you do from pushing 180 F water through the same pipes.  Yes, if you let that 140 F water sit long enough then it would end up at the same temperature as the room (and vice versa) but then you aren't pushing the water through very quickly so you don't heat transferred fast enough to make the room as hot as you would like. You can't have it both ways. Ask on https://physics.stackexchange.com/ for a detailed explanation. This is also the reason why you want your air conditioned air coming through relatively cold - if you pump 60 F air through your house it will feel cool but it won't cool the house nearly as effectively as 50 F air.