I think option 1 is preferable, as long as if only effects the pools when heart wincons are on

My 2¢, I think it would be better to make them officially incompatible. Changing the way Scarce and Minimal work in just this one setting is an inelegant solution (especially since it differs from how they would behave otherwise re: converting all 17 (or less with extra starting hearts) hearts into either HPs or HCs). I think just accepting that some things don't work together is better than shoehorning in compatibility with settings that, in there basic descriptions, clearly can't be utilized together.

I think it might be a good time to decouple the item pool setting from the number of available hearts. I think this is a good idea regardless of the existence of the heart wincon, because I think people not confident in combat ability might still enjoy occasionally playing with low major item availability. It was suggested to turn starting hearts then into a double slider, with total available hearts at the top. Nobody has implemented double sliders yet.

(And doing that might free up some options for what to do about this issue. Personally I think I would expect to not be able to select a wincon with more hearts that I've set to be available. So if you implement the above slider, you could tie that and the heart wincon slider together in some way. Maybe make sure they're not too far apart from each other so people can see the relation. And I doubt anybody has set up a way of handling that in the GUI either lol.)

Intuitively, I thought Scarce and Minimal are available and with minimal i've only PoH required to the bridge or BK and in Scarce, I've all PoH to have 20 hearts.
I like the @r0bd0g solution, today we can use plandomizer to change item pool manually.