I had a pinion throw the set screw and it must've galled the shaft a bit as it is stuck with no set screw.

It's a nylon pinion molded on to an aluminum collar.

Option 1 is a pinion puller.
Option 2 is a dremel cut off wheel to split the collar.

Is there an option 3 I have not considered?

If not, is there a benefit or downside (other than a destroyed pinion) to option 1 vs 2?