Solution 1:

It's good that you give this a lot of thought, b/c even if the Virgin router was powerful as hell you wouldn't want to serve all the hardware of 10 people with one wifi router anyways. I'd suggest you use as much cat5 as you can afford. The more stations, the worse the performace you will gain with wifi and with 10 people i'd guess there are (at least) 15 stations at any moment in time connected to your wifi and if those are doing stuff like HD videos and gaming performance will drop severely and fast.

Powerlan is probably not an option as it's very likely to not work across stories, as both powerlan endpoints need to be on the same electric circuit. And it's always a bit of coin flippy as it's performance depends on your wiring. How recently was your building built?

You should at least get one AP for each floor and connect each AP to the router with cat5. Make sure each AP uses different channels, at least 2 apart from one another and reduce their output wattage as much as possible (while still having wfi access in every room) to reduce interference. Also, place the APs strategically: don't just put one on each floor at the stairs.

With 10 students all being at home in the evening doing data-rate intensive stuff you man still run into performance issues, but those aren't trivial to resolve. Good luck ...