To be honest, Option 3 isn't terrible and could have been worse. The biggest priority really should be doing amazingly well on Level 2. Like leaps and bounds higher. You need to really demonstrate your potential. If you plan things right, I think you can do it.
I have nothing against your choice not to apply FM. Its completely reasonable given that they are different enough fields, and you seem to know pretty strongly what you want.
Have you thought about applying to 1-yr programs, like TRI/TYs and pre-lim medicine years, as a backup (preferably those at places that have a psych program)? The thing is that you'll be applying for the 2020 match, meaning that the AOA match will be over and you won't have AOA only programs to fall back on. Most likely you'll be applying via the NRMP match and programs that won't fill will be in the SOAP, which will have a ton of unmatched people vying for diminishing spots. It is honestly in your best interest to match somewhere as opposed to have to SOAP, because at the end of the day, its still possible not to find a spot or to find a spot that makes you so miserable that you don't finish that 1 year of residency, which is essential for working as a doctor.
I would also apply very broadly for Psych, and focus your efforts on community programs in less desirable areas. By all means, apply to places outside of that (university and more competitive cities), but you should also be applying to the majority of community psych programs in the midwest. I would also go on as many interviews as you can (you're going to have some time on your hands). You need to increase your chances as much as possible that you will match. I know you know this, but you really need it to internalize it. No one says you have to do FM/IM, but you need to internalize this idea.
In terms of how to spend the remaining time, I'd look at psych-centered volunteering and clinical research opportunities in your area. I will help in terms of having something to say on interviews, usually you have flexibility time-wise, and it will help if you have to reapply next year, because intern year will likely be pretty busy and you'll never have as much time as you're going to have that year.