How do I interpret my furnace clearance diagram?
I would interpret the drawing as you did,however the inspector mentioned 30". I would verify that there is not a local code that requires 30". Another thought is that if you install it with a zero clearance and it requires service acess may be an issue unless your design allows for an acess panel. Also you want to take into account that at some point the furnace will need to replaced. You don't want to add demolition and reconstruction of the space to the cost of the furnace.