IMO the real wood is my choice I think tile that looks like wood only works if you do not have real wood next to it. As for these 2 choices one is the complete opposite of the other cost wise so can’t get that. Painting sub floor is never a choice unless you have an industrial loft space

Match the Red Oak, have it laced in and then sand and refinish everything at once. It looks very odd to have wood in the kitchen and tile everywhere else. The is the reverse of traditional home construction and can and will feel/look very odd.

Painting a subfloor is a great way to ruining a subfloor. Most floors have a hard time going down over anything other than CLEAN subfloors. Paint is not "clean" it is a chemical that will prevent other floors from being installed at a later date. If you paint, be prepared to have to remove the substrate, and put a new one down AND THEN you install a new floor. It is like throwing good money after bad.

If you don't like wood, you can remove the kitchen wood and do tile throughout...now you have NO clash of materials....assuming you have given us the whole picture and the only room with hardwood is the kitchen.