I'm pretty sure it is the 1st of your 2 scenarios. I successfully transferred ownership from the gmail#1 account to gmail#2 and my Adwords seems to be setup correctly (without billing info). I'll look into setting up an MCC account now that I know it won't hurt the grant status.
The application guide states we are required to enter country & currency (dollars specifically), but NOT to enter billing info. They're on the same form so I don't want to risk saving to the account and losing grant eligibility. Should I just leave 'as-is' and wait for approval?
The campaign status is still showing billing info requirement.