Bluetooth shouldn't be a part of the problem as it uses a totally different set of HW and SW protocols. But turning it on and off might cause the OS to go thru different network initialization paths that might affect how the WiFi is configured or used.
Changing the number of users from 5 to 1 shouldn't affect things either. Actually having it higher than 1 is probably good and I probably wouldn't go below 3. If you have the option on the HTC, make sure the Broadcast channel for the hotspot is set to Automatic. This will force it to hunt for open channels and minimize interference with other user's hotspots.
I suspect you might be stuck with an HTC bug in the phone. I have a LG Android running 5.1.1 and I just enabled the hotspot software then connected thru it with a Mac laptop to the internet without any problems at all. I was going to try to really stress test things by having the LG phone also use its WiFi to connect to my home Unix based router and from there onto the Internet, but Android OS prohibits the use of WiFi for both hotspot and internet at the same time. (Come to think about it, I don't think I can configure that on my wireless network on my Unix system either.)
I have noticed on Android 5.1.1 on my LG that it sometimes gets confused when it should use WiFi for data and when it should use the cell connection. Turning WiFi off then turning it back on seems to get it back on track, and as I posted earlier someone reported that same trick seemed to help the IP address conflict issue.
You might also try the trick of not letting your phone go to sleep when you're using it as a hotspot. Another user on the Android developer forums reported that seemed to fix the problem of IP address conflict for him.
Failing all that, since you have a Verizon phone you might ask Verizon to loan you a different brand phone to see if that solves the problem. If it does then you can either upgrade your phone or make the case to Verizon that the HTC phone doesn't work as a hotspot.
Oh, your HTC is providing dynamic IP addresses to your computer via DHCP. On your Windows computer go to the Network Control Panel (I think that's were it is) and make sure your computer is set to make its connection using DHCP.
Sorry I couldn't be any more help.