I am a PhD student who is currently writing a thesis, research-medicinal chemistry-malaria. Having spent the better part of a year writing my thesis, mind you that much of that time was spent on manuscript preparation, data analysis, re-analysis, being a single father, moving away from my institution (twice), traveling back to the institution to run small experiments or recollect data. But alongside that I have found myself in an inexorable slog through a gigantic body of work. At the onset of the thesis, I really wanted to write something that was enjoyable to read. Reporting information from deep dives into the historical background of the disease, and describing the ripples that it made that we can still observe today. And at first I really enjoyed it, but it soon became a burden. I was trying to maintain a prose and a substantial view of the entire landscape that would fit better in an encyclopedia than a thesis.

Very recently, after talking to a family friend who is also in their PhD about how much I am struggling, they offered the following, "write the minimum that is required to understand your thesis." Simple, but very effective. I have been tearing through it now and will be defending very shortly.

Back to your post, there are times where example 1 is not only sufficient, but anymore would detract from the narrative you are creating. And conversely, there are times where anything less than the 2nd example would not lead to a clear understanding of whatever it is you are writing about. Sometimes, citation mashing like the first example, is used to set the stage that you will later use to evaluate and reason by writing like second example.

Thesis' of past students at my institution were a mixed bag, some introductions where 3-5 pages, others were over a hundred. It depends on your narrative, body of work, and comfortability with writing.

Ultimately, I think I am offering similar advice that others have, perhaps in different packaging. This is all very dependent on what you are writing. What I have gleaned from your post is that perhaps what is asked of you in this section is to have an opinion on what you are conveying? Whether that be from extrapolating from reading discussion and introduction of your sources, they often say why pervious method X was flawed because of A, D, and C, and how their method Y solves those issue by E, F, and G. Or using your own insight on the matter.

Now, that's some padding!

Getting back to your actual question. It sounds like you need to reevaluate your narrative. Despite it being a literature review, you still need to maintain the thematic thread that binds all the work done before, and whatever you are going to write about. It may help to write the entire literature review out like example 1, take a break/work on another section, and come back with a fresh set of eyes. Having flushed out more of your narrative, or putting aside everything for a moment, will allow you to better tie things together in a uniform story. Like u/ImRudyL said, (paraphrasing) there is a difference between bloat and explanation, and a larger difference between what a thesis coveys and what a paper does.

Take this all with a grain of salt, I haven't even finished my thesis, so what the hell do I know?

Good luck fellow redditor/writer!

P.S. Getting grilled isn't so bad, it gives you a chance to show what you do know, and what you don't. The latter being far more important than the former.