DD had severe jaundice due to AB/O incompatibility, so had to be incubated for light therapy for much of our 6 day stay - though we did bedshare - in the hospital bed - with lots of pillows - until her jaundice was diagnosed. After that, we roomshared, and was in my arms as often as possible while nursing. It was a baby friendly designated hospital, so room/bedsharing was encouraged. No problems with holding her as much as we wanted (other than the obvious - the less time she was under the lights, the higher her bili levels went)
DS also had severe jaundice due to AB/O incompatibility, and was also preterm (36 weeks). We were prepared this time, and due to pretermness I insisted on keeping him skin to skin, and phototherapy was done with a biliblanket. Biliblanket is less effective than incubator light therapy, so we had to treat for 2 weeks at home, but hospital stay was only 3 days, instead of 6!
This hospital did NOT encourage bed sharing or rooming in, and the nurses were frequently asking me if I'd rather have him in the nursery, or in the basinette next to the bed ("aren't you TIRED of holding him?" WHAT?
). The thing is... when you have had a C-section, getting the baby OUT of the basinette requires another person, at least at first, so there was no way I was letting DS go. Basically, we stayed connected from birth (oh yes, I insisted on him being placed on my chest immediately post-C as well ... they LOVED us at that hospital. HA!). There were a couple awesome nurses though, who really GOT it.
So, anyway, I voted the second option. Cause I did it anyway.