This is probably when the legend of the "Houdini mansion" took root. When Bess would throw parties or hold seances, etc., she would do so at the Walker mansion across the street. In fact, the guesthouse had an elevator that went down to a tunnel that ran below Laurel Canyon and came up in the big house grounds (the tunnel is sealed but still exists). One can understand how local magicians who attended these events came to assume that the house belonged to Bess and, by extension, Houdini. The "Houdini mansion."
Bess and Edward Saint left 2435 Laurel Canyon when Walker either died or sold the estate in 1935 to a real estate broker named Charles Wilson. The property went through a series of renters, including evangelist Joe Jeffers, who turned the mansion into the Temple of Yahweh and required donations of up to $100,000 to live on the property. Following Jeffers came an eccentric poetess, Lee Alden, who was known as "The Green Virgin." After Charles Wilson's death in 1954, Fania Pearson bought the property with the intention of turning it into a girls school.
But then in 1959 the Walker mansion and the guesthouse at 2435, which was then owned by a man named Al Sulprizio, both fell victim to the great Laurel Canyon fire. Newspapers at the time reported that "the old Houdini mansion" was among the homes destroyed. The clip below is a news report on that famous fire. While there are no photos of the Houdini guesthouse, Patrick thinks it's possible the house can be glimpsed at 0:30. It appears to fit the description of a house that sits on a bluff above the road. [UPDATE: This is actually part of the original Walker mansion on fire.]
What's under the playboy mansion? follow the white rabbit.