How do conflicting breach modifiers stack?

Solution 1:

Yes they cancel each other out.

The modifiers are generated randomly, though the amount of positive and negative modifiers itself does appear to be fixed). The game doesn't exclude modifiers that cancel each other out, and this is one such case.

Whether that's by design or not is up for debate and not meaningfully answerable other than by the developers themselves.

Note that a mod was released that addresses this issue.