Option 1 for me.
I tried the PC to large screen LCD a while back and while I could see some of the benefits, most noticeably was the comfort of sitting on your sofa with a wireless mouse and keyboard, I just couldnt 'play' the game the same as I would at a desk with the screen much closer to me. I even tried using a beanbag close to the LCD TV to 'immerse' myself a bit more but it still didnt work as good. Maybe Im just so used to a desk and monitor that anything else just dosent work for me. Also, most of my game playing is first person shooters, so its a no brainer that accuracy is much better sat on a chair, at a desk and the screen nice and close.
However, if you are a driving game fan then give it a try as the handful of driving games I tried when sat on the sofa were great fun, crisp graphics on a big screen. It felt very 'console-like', you could even get a PC 360 controller to make it even better maybe.