The second is that he wants me to be present with a torque wrench and wants to see that I have tightened the service lugs in the main breaker panel to the suggested torque. He is not concerned about the lugs in the meter enclosure. Anyone else run into these requirements ?
Yikes. It's the job of the "inspector" to inspect. Some things do require the contractor to be there, as example, gas line pressure test, my AHJ requires the contractor or homeowner to be there with an air compressor, the gas line must have a psi gauge on it, gauge must be at zero with a verification by pressing open a schrader valve, then the line pumped up, wait a period of time, then inspector will release pressure back to zero to verify the gauge is not faulty.
But show them the torque is good? That's kinda odd, how would they verify the torque tool is accurate/good? It's the job of the "inspector" to inspect, so s/he should come with their own calibrated torque tool to check things.