It depends on many different factors, there is no right or wrong way. If the keywords are very closely related, it might be a good idea to target all of them with the homepage. This will also allow you to vary anchor text and create a natural-feeling link building effect.

Cheers,

Josip

And the prize for longest domain names goes to...

Having quality content (fresh, interesting, unique) together with creating inbound links or back links helps your site get higher rankings.

If you work continuous on the options you have mention than there are good chances to get high pr for all keywords.

I usually go for option 2, mainly because i like to focus on one keyword per page. however optimizing your main page for 3 - 4 keywords is fine.

The major thing that you have to consider is the density of keyword that you are targeting. If the page which has a higher density of your keyword prefer to use that page instead of home page or any other page.

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I just started in SEO 6 months ago. I concentrated on 3 key phrases, mainly concentrating on the one which I was ranking for highest initially. Targeted that key phrase, got to page one for that, then targeted the 2nd until I got to page one, and so on...worked quite well for me...got to no 1 for 3 out of 4, no2 for 1 and no 10 for the other (although I have just dropped from PR4 to 0 but thats another story)

If keywords are related, select option 1.