Fifth option. Not everything, but quite a bit.
I hold all the books of prophecy to be inspired, including Deuteronomy and Psalms (which are prophetic books but usually classed as Law and Poetry, respectively).
What isn't inspired? The books of History (Jos - 2Ch, Ezra, Nehemiah). The Poetic books that aren't written by David (Esther, Proverbs, Ecclesiastes, Songs). The historical bits of the New Testament. The 3 Pastoral epistles that were deemed to be Paul's but aren't actually (1Ti - Titus).
For many books, it's a mixture. The author may not be a prophet, but he recounts places where prophets speak, and I take those bits as inspired. For some books that ends up being most of the book (e.g. Exodus). The words of Jesus - inspired. Words attributed directly to God - inspired. Any place where the author claims to give a word of prophecy or speak by way of inspiration - inspired.
Essentially, I hold to a rule - if it says it's inspired, believe it.