Thanks to all my friends who provided their input on where to mount my rigid SRQ2 lights.
I decided on basically the #2 option.
I used an air 3" cutting wheel and jig saw. The jig saw actually worked easiest after drilling 4 1/2" holes in each corner of the square I was cutting out.
Luckily the tape protected the bumper paint as I was using the saws.
After deburring the holes I painted with several coats of paint all around the freshly cut edge of the hole. There is no exposed metal to rust in the future.
I then layer the edge with silicon to add even another layer of sealer over the fresh cuts.
Mounted my lights and used my Dually flood back-up light harness for the SRQ2 lights. I then moved my Dually flood's up to the factory fog location and tapped into the factory harness using a female 9006 to Rigid adapter I made.
All turned out great in my opinion.
I will say the diffused SRQ2 put out a ton of ambient lighting in the rear. I can see ants crawling on my driveway behind my truck in the camera with these lights.
The Dually's worked well too but the light was too focused with the flood pattern. These diffused disperse the light much better and don't blind the camera at all.
I really like the idea of being integrated into the bumper verses hanging down somewhere asking to get torn off. This option looks more finished than just mounting lights to hang down somewhere.
I didn't take any night shots as its just too bright for my camera to pick-up.
Here are a few before hacking my bumper and then the final finished look
Also the angle is deceiving, the lights are exactly 4.5" from the sensor as well as the center plastic trip piece, perfectly centered.