>3) Same thing that happens right now? Two separate emails get sent out each encrypted separately with the receiver's public key.

Wouldn't this mean you lose the ability to show all recipients to all recipients? E.g. multiple To or Cc entries seem... probably not possible, since that would imply also sending to them? At that point it isn't "multiple recipients of an email", it's "multiple emails", and that's an only-sometimes-minor difference.

I definitely do not know email in enough detail to be sure though.