Well I did say that I want the precedent of WTW, which is: Two factions can trade maximally one settlement per turn. Such settlements can only be traded if they are not in danger of being besieged by any number of enemy units, AND the switch, along with the disbanding of units can happen before the settlement could be besieged. If such settlements borders an enemy province, the two players trading the settlement must notify their enemy(s) that the trade will happen. Their enemy(s) may show proof that the settlement can indeed be besieged to prevent the trade.
That would be option 2, really.