Solution 1:

This is a question of style, so the best I can do is record what some style manuals say about it, directly or indirectly. Having said that, all but one manual I consulted would recommend that you use the quotes of some sort there.

Discussion

The only style manual that treats this issue explicitly is the Associated Press Stylebook (entry for nicknames):

When a nickname is inserted into the identification of an individual, use quotation marks: Sen. Henry M. “Scoop” Jackson. Also: Jackson is known as “Scoop.”

Garner's Modern American Usage, in its entry for flail; flay, gives the following example, which suggests it too prefers to put nicknames in quotes:

"He was nicknamed 'the human locomotive' because of his ungainly style..."

In the Oxford Guide to Style we find the following, which suggests this guide would recommend against quotes in your case (p. 87, emphasis mine):

A nickname can supplement or supplant the owner's original name: the Yankee Clipper (Joe DiMaggio), the Sun King (Louis XIV of France), the Fat Controller (Sir Topham Hatt), Ernest 'Papa' Hemingway, Charlie 'Bird' Barker. Through use it can eventually replace the owner's name, either occasionally (Old Blue Eyes,Il Duce, The Wasp of Twickenham), partially (Fats Waller, Capability Brown, Bugsy Siegal, Grandma Moses, Malcolm X), (Howlin' Wolf, Muddy Waters, Meat Loaf, Twiggy). While no rules govern whether a nickname is put in quotation marks, the tendency is for quotation marks to be used more often when the nickname is inserted within or precedes another name, and less when used alone.

The Chicago Manual Style, in its FAQ, says

After using quotation marks at the first mention of a nickname in the text, you can drop the quotation marks for subsequent mentions. In the notes, however, use the quotation marks for every citation.