Those are the primary options and you establish that before the off-season in private to give them a fair chance to get in shape, offer them all the resources in the world, their own chef and trainer the whole nine yards. At that point, if you've told them what you expected of them, and it's a reasonable thing to expect, and you've given them the resources, and they flat out refuse then you can't go forward with players like this. You can't have core pieces who don't want to be professionals, and professionals have to take their bodies seriously.
The alternative is to send a message to everyone in your organization that you're not going to take fitness and nutrition seriously, to run these guys out there and then what? Do you lock them up to long-term contracts with those bodies? Do you wait for them to break down and then try to trade them? You can't count on them long term so if you have to cut bait then cut bait.