There is no third option. No reason watch these movies in any order except for these listed here.

Do the movies function best in order of release or in chronological order?

Does "the twist" work better if you know what's up going in or if it's totally a surprise?

Does the prequel trilogy actually function as prequels, or are they better viewed as sequels?

Discuss!

watch the old skool then see the awesome of the new skool
or watch the new skool then see the awesome of the old skool

I guess chronological if you are going to watch them all. Personally I'd recommend watching the OT only - the prequels really labour in sequence, taking ages to get anywhere compared to the speed (and ironically competence) with which the OT convey their narrative and characters.

I recommend watching them in the order they were made. That way you will enjoy the Force in the original 3 movies as the mystical power it's supposed to be, instead of looking at it as the "midichlorians" mumbo jumbo.

This is close to my reasoning for watching them in order of release.

Basically I don't think that the prequels actually function very well at all as prequels, and build off of knowledge that one already has from watching the original trilogy. How much does The Twist mean after the end of Revenge of the Sith? Not as much at all!

I think that understanding is best facilitated by watching the original trilogy first, basically

The prequels were made in a world that already had eps. 4-6. Lucas and everyone making the prequels were fully aware of what had come before, and the films reflect that knowledge.

So, the order to watch is 456123.

Watch the prequels first, so that you don't end the saga with "NOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO!"

End it on a high note with the original saga.

Actually, this is a really good point.

Watch the original theatrical releases of Episodes 4 through 6 and don’t watch the rest.

Are these even available anymore?