I use full fenders for touring and commuting. Add some rain gear and I will stay perfectly clean enough to go anywhere, even in a suit and tie (argh).

As for the bike, fenders do help especially with mud flaps added. But I don't care so much about the bike. I treat my bike like the underside of a car - I keep everything lubricated and in good working order, but I sure as hell don't clean it or worry about it getting dirty.

Given all that, my answer to your poll was Choice #1. I love fenders on yucky days.