i would pick the 2nd choice to produce better image when zooming. tho the camera is bad but the post processing it have would produce better imaging and less noise.

image sensor, it makes the pixel larger and let more light which produce crispy image. tho im not sure about this in mobile phone hardware but this is normal in filming and stand alone camera. just try to stay around your "shitty high megapixel camera vs fully-features low megapixel camera" issue.