Usually subwoofers have questionable quality high-pass filters into the speakers. I recommend going with #1 for the reasons Yoyo suggests, and carefully adjust the subwoofer's internal low-pass filter to have the subwoofer "fill in" below the range of the speakers.
Here is a rough guide to help you out:
1. Download low-frequency test tones:
http://www.realtraps.com/test-cd.htm
2. Play the mp3 files in a media player on your computer with only speaker hooked up.
3. Notice how the bass dies below ~50-80hz (figure out about which frequency since the mp3s are in 1 hz increments)
4. Add in the subwoofer and dial the low-pass filter to roughly that frequency
5. Play test tones again with both speaker and subwoofer. Adjust the volume of the subwoofer to make the whole range seemless in terms of volume level between subwoofer and speaker intersection.
6. If no matter what you do there is no bass at the crossover, adjust the phase switch of the subwoofer.
And then, sit back and enjoy excellent full-range stereo music on a budget
As you listen, you can play with how you angle the speakers towards your ears and the speaker's height, distance between the wall behind the speaker and the speaker etc. This type of tweaking will alter the high frequency presentation and the imaging of the speakers.
If you are unhappy with the variation of the volume in the bass (due to listening to the mp3s), it is not necessarily the subwoofer or the setting's fault. It is the location of the subwoofer within the room that is causing these variations. I tend to like to keep the subwoofer in between the speakers relative to the ears so that the bass seems to come from both speakers. If the subwoofer is somewhere closer to one speaker with respect to the other speaker, the upper bass will seem to shift towards that speaker.