Hello James,
I personally prefer option 2 as well, although this might depend on the stimulus material and the task to some extent (in case subjects have to respond during stimulus presentation, it might be better to use the reaction time instead of stimulus presentation, at least if subjects are faster than these 4 s).
Mechelli et al. compare different ways how to handle a block design, that is they compare option 1 with option 3. Thus their findings do not argue against option 2.
Nonetheless they deal with an interesting aspect of epoch-related designs in general. The hemodynamic response function of an epoch-related design reaches its peak later than the one of an event-related design. Of note, they employ a duration of 18 s, so this effect should be negligible (or much smaller at least) in your case.
Best,
Gabor
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