Both of your recommendations may suffice for a 20-yr old car where the drain plug will never be touched again, but neither of them restores the threads to their intended purpose.Over sized plug would be my choice, next would be a teflon tape. It's a 20 year old beater and that drain bolt is not used often. OP will probably never have to touch it again.
People were truly trained not to repair anymore. It's just replace.
I don't know if I would call them "repair options."