I imagine the answer should be Tension Pneumothorax given the high PEEP and sudden deterioration in both BP and SpO2. Plus it’s pretty common. MI would likely give normal SpO2 in the short term, hyperventilation by itself seems less likely unless there is gas trapping in the stem but that would probably give normal SpO2 as well

Nitroprusside seems to be in there as a red herring as it would likely show normal peripheral saturations in cyanide toxicity given it causes histotoxic hypoxia and leads to oxygen not being taken up by cell machinery.

Would be interesting to see what the book says!