[pushkins]

You don't need to run it anywhere on the outside of the dwelling.

Simply run it to an exterior wall then run it up "in" the wall and straight out through the roof. If your worried about snow slide etc...then use a retaining strap. (round ring goes around the pipe and clams on, the two straps go under shingles).
2" pipe will be very easy to push up into the wall cavity. (or down if your coming from the roof).

I think code says that the vent must be 2' higher than anything within 3' and must be 10' from any opening eg: skylight etc...

Cutting into cast iron is most definitely not for the faint of heart.

It sounds like your inspector wants the pipe painted if installed on the exterior simply as a cosmetic thing, after all, who wants to see black pipe snaking it's way around and up the house walls !