I've always gone with option 1.
Option 2 seems silly to me - depending on your yeast and your wort, day 21 could be literally ANY stage of fermentation. Let the hydro be your guide, not the calendar, whether you choose to go with 75% of FG or FG itself.
At 75% of FG, you know the yeast are still active, and any part of the fermentation that should produce off-flavors is done with, so that should be a good time to do it and encourage the yeast to clean up the Diacetyl.
At FG itself, if you time it right, the yeast shouldn't be all dormant yet, so that _should_ work, but it may take a little longer to complete the rest than if you do it while you know the yeast are still active.