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I voted option #2. A publisher not-offering to libraries won't completely stop me from buying from them if they've otherwise got a good price on a good book by an author whose works I like and want to support.
But for more marginal hey-this-looks-possibly-interesting-to-try-out stuff, I would definitely give more consideration/allow a higher price-point to a library-available publisher than one who outright refused or was working to undermine the existing system, whom I would probably decide "no, not really" unless the dirt-cheap price and promising blurb/sample and author's award-nominee reputation in the field were really compelling.
I vote with my wallet, but it's weighted-preference proportional voting rather than first-past-the-post winner-take-all.
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