A variation of Option 2:
Turn the cylinder, sand and polish.
To turn sand and polish the domed ends, wrap with tape for protection, and grip in pin jaws.
Belt sander safer than bandsaw for shaping the flat, just takes longer.
Hot-melt glue the flat to a piece of plywood. Attach the plywood to two planks to form a bridge on the router table.
Rout the slot.
Bake to remove the hot melt glue, and clean up with acetone.
Of course truth is stranger than fiction.
Fiction has to make sense. - Mark Twain