The DM has not constructed a no win scenario. Keeping the PC alive is a win. It may be boring for the player unless the DM changes his mind on B, but it's a win for the PCs.
Personally, if the DM won't budge on B, I like option D better.
Players: "We're going to be playing something else instead of D&D." or "We've decided on a new DM."
The DM made a mistake and refuses to fix it. That's bad. He should be replaced.
False Equivalence. The PCs are not faced with that option. Their companion can be fixed as good as new, unlike the real life brain dead choice. Since the PCs know that, killing the PC to save themselves some liability is a murder of expedience and is therefore evil.
I'm not declaring the party to be evil. I'm saying the act is evil. A murder of expedience to save the party some trouble is never anything but. Even if the entire world rested on their shoulders, it would still be an evil act to murder the PC to make things easier on themselves. Perhaps necessary, but still evil.
I think the core problem is two specific points in our argument. I do not believe it would be a win to drag the PC through the underdark, UNLESS the DM changes his mind on the PC limit. I also do not believe something truly necessary, to the point of the death of the entire human race or even further, the death of the planet, can be Evil. Unsavory, most definitely. A guilty burr in one's mind for the rest of one's life? Possibly, depending on the underlying psychology of the character. I think what is far more selfish, if you are on a quest to save the world, would be keeping your old friend alive, even when they seriously jeopardize the saving of the world. Unless of course you planned to ditch them in the middle of a fight, as soon as they start making things more difficult.
Also, it is not a false equivalence. One of the main hopes of those who keep a loved one on life support is "Maybe they will get better". From a character point of view, they are not positive they can reach help. They are not positive they will ever be able to fix the PC, and considering the underdark, it is very likely they will all die, and the PC will be kept as an amusing slave by someone, or just slaughtered along with them.
I should note, I am not saying they should kill the PC immediately, just because they might be a problem in the future. I am saying that it would not be Evil if they went for a few weeks, and saw no sign of improvement in the PC, and decided that there was just no hope for him.
Iserith, I apologize if it seemed I was insulting the DM. What I meant was that the DM was making a mistake that kept a player from playing. An honest mistake, though compounded by the limit on PCs. I think the Players would be worse than that, if they were to go along with this, and help to exclude their friend, hence my use of the D-word.