Authentication inside scripts - user login or application

Creating an app registration is highly privileged operation, and it's unlikely that many orgs out there will be willing to run a script that does that. Similarly, consenting to third-party apps is also something that's getting increasingly more scrutiny. For me personally, the best option is to leave the authentication part to whoever will be running the script. Make sure you detail the required permissions/scopes and if you believe it's necessary, include instructions on how to create an app, configure authentication and permissions, consent where needed, etc.
Alternatively, consider reworking the script to use the Microsoft Graph SDK for PowerShell instead of direct Graph API queries, which makes it easier to share, or at least to detail the requirements.