Hi guys

I am new to the forum. We are building a 2 story detached garage.
480 sq ft 1st floor and 480 sq ft 2nd floor.
12' ceiling on 1st floor. 8' on 2nd floor.
The bottom level will be used to store classic muscle cars.
The upstairs level will be a game room.
There is a door and then staircase needed to get to the game room.
We plan to foam insulate the entire building.
I am thinking of going with a mini slit ductless ac set up.

Question:
Can I have one dual head mini split unit supply heating and air to both levels?
Is there any concern about carbon monoxide if I have a single unit running both spaces?
The bottom side of the floor of the 2nd level will be foamed as well to separate it from the bottom garage space.

Tons of issues. Where to start?

Carbon monoxide is a problem along with fire code issues and VOC's from fuel tanks. Muscle cars were notorious for off-gassing since the vehicles didn't have proper vapor storage on their fuel systems.

One mini split cannot manage two floors. Heat rises, cool air drops. You can't fight physics. Two mini splits would be required if you want each floor to be conditioned properly.

Check with your local codes to see what they allow. They might not even allow such a design without fire sprinklers.

If you build it, use one piece floor trusses which are much easier to air seal than shorter joists and beams; insulate them well and seal them with a taped permeable membrane and drywall.. There is off gassing from hot engines so air-sealing the living quarters is literally critical.

There are fire code requirements for attached garages, but it should be doable. You will probably have to sheath the garage ceiling in 5/8" sheetrock at the very least. Most definitely air seal well between the garage and upper level. A ventilator system would be a good idea, perhaps one on a timer so it runs for a few minutes after you have closed the garage door and driven away in one of your hot rods.

The building official may spec a sprinkler system...

How exactly do you get to the upstairs game room? If it is THRU the garage portion, you may need to plan on an additional external door and stair to provide another means of egress from the upstairs area, or just make the upstairs access all external.

A few minutes discussion over some basic sketched drawings of your idea with your local building department might really help to get you proceeding in the right direction toward a set of plans they will pass without need for major revisions...