The cautiousness around trial periods, discounted offers, and continuity programs by credit card processing providers is due to recent crack down from Visa and MasterCard. The guidelines and rules passed down by them are a little vague so the card association banks have mostly erred on the conservative side.
The premise behind the concern is that these types of offers and billing methods increase chargeback risk and financial loss. This is especially true for new merchants or higher risk products or services.
We've been hearing from some of the banks we work with that they're considering loosening up their rules or applying them differently to certain types of merchants.
Regarding your dilemma, option #1 should have fewer chargebacks, which can be costly to your business.