@qork If any of this between your boss and HR is verbal send a follow up email and BCC your personal email to have in writing that "thanks for talking to me about my PTO use today, I look forward to hearing your response." Or something of that nature. I've been in too many screwy situations...
@xxwunderkindxx I'm not the most knowledgeable HR professional but that policy doesn't sound right. However, idk if it's worth pushing it or talking to a labor lawyer. Other than that, based on your options B sounds the best to me personally.