01

Lord Oberon is much larger than that 4"x 5" square. He cannot fit inside it, so he could not get lost. Nor do I believe that Lord Oberon, a man with legendary tracking skills, would ever lose his way in the first place. This is a blatant trick question.

Respectfully,

Both 1 and 2, but not 3. Let me explain. You see the rules were to:
"Leave a comment - with the solution - to receive your Reward - and the undying gratitude of Lord Oberon!"
So, let's give the path a width of one step. This would make path #2 about 266 steps from the exit and path #1 about 680 steps from the exit. Or  you could say that path #2 is 37.5% closer to the exit or 3/8's of the distance. You could also say that path #1 is 2.55 times longer than path #2. So, depending on how much time our good Lord wants to wander around in the woods with his scantily clad archers is up to him...

Personally, after a battle like that I might tell the rest of the crew to take path #2 back to the castle and the archers and I would take path #1, and maybe take a little nap along the way or go for a dip in a nice little pool to freshen up a bit after all of the rigorous activities we would enjoy! This recommendation, I believe, would arouse the most gratitude from great Lord Oberon I am quite sure...