The Harrowed trait is not optional and the rulebook compendium will be updated for clarity. Neither option is valid due to the following under Take Yer Lumps:
Each player must try to “fairly cover” casualties as exactly as possible, e.g. you must discard one dude if you have only one casualty (i.e. you cannot ace a dude for one casualty), and you must ace all your dudes if your casualty number is twice or more the number of dudes you have in the posse.
When a dude with the Harrowed keyword is involved in a shootout, that dude can absorb more casualties than a normal dude. You can send a Harrowed dude home booted to cover one of the casualties you take in a shootout. Discarding a Harrowed dude covers two casualties, and acing a Harrowed dude covers three casualties. If a Harrowed dude in play gets aced by a card effect (but not through being aced to cover casualties in a shootout), discard that dude instead of acing them.
The Take Yer Lumps rule must be followed when dealing with the Harrowed trait.