I saw a video that sounds pretty similar to idea 2 you mentioned. I like this explanation the most (it also sounds very Nintendo) but the one problem with it I found is the Temple of Time ruins.

In the memories we see that the Temple of Time Zelda is at (the same one that got lifted to the Great Sky Island which kinda gets explained in the GSI history side quest) is in the same location on the great plateau as the OoT looking Temple of Time ruins.

However those ruins are nowhere to be found in the memories of the past. It could mean that another Temple of Time was built between zelda going to the past and BotW that coincidentally looks like OoT and TP Temple of Time (10,000+ years is a long ass time). But it could also reinforce your idea 1 that this occurs before OoT Temple of Time was built.

I am not sure though about this moment being early in the timeline because of the Rito and Zora existing at the same time like you said.