Would need more information to make a decision, how many years service, is it a DC or DB Pension scheme.
Waiving your right to a Pension lump sum, is not always the best option. That amount will grow significantly over time,(it could potentially double in 15 years) and most likely grow significantly more, than she could grow the fund herself, if she invested the bigger payout on redundancy, and is almost always paid out tax free.
Waiving the lump sum, is often more appropriate for employees,very close to retirement. Age 53, is almost 15 years in advance, of receiving the state contributory pension, thats a long time.
It sounds like, the redundancy payout would clear the mortgage anyway, under option A.