What to do? SE or Decommission

I’ll start by outlining our current environment for context:

Two standalone Exchange Server 2016 VMs.
Primarily used for recipient management in a hybrid setup.
Also functions as an anonymous relay for two LOB applications — one of which requires the mail service to reside on the same network as the application (as per vendor requirement).
We have not opted for Extended Support (ESU) and installed the latest available Security Update last week.

Management has been presented with the following options to move forward:

1) Perform a legacy upgrade — build two new servers and migrate from Exchange 2016 to Subscription Edition (SE).
2) Migrate LOB applications to another SMTP service — this would allow continued use of Exchange Management Shell for recipient management (by setting up a new server, preparing the schema for SE, and following Microsoft’s decommissioning process).
3) Migrate both LOB applications to another SMTP service and management to alternative platforms such as Easy365 or ManageEngine, removing the dependency on Exchange entirely.

This post is mainly to gather some insights and general discussion around the best path forward.

From a risk management perspective, since we’re effectively sitting on a time bomb without further Microsoft updates, I’m leaning toward option 2, especially given that all mailboxes have long been migrated to Exchange Online.

What should I be watching out for with this approach?
It seems many have taken a similar path — I’d appreciate hearing about any challenges or pitfalls you encountered and how you mitigated them during implementation.