All, if done right, are likely acceptable. We tend to be more like contractor B in that we cut back the area around the window to get the flashing and nailing flange back in, but that is just one of the ways it can be done.

Each method is fine. Which window brands are you considering?

Contractor 3 should be disqualified IMO. That is not a method recognized as acceptable by anyone that I have ever seen or heard. The siding will likely be damaged by "prying it up", and there is no benefit to a nail fin if it is simply slid behind the siding without being sealed and taped.

Method 2 is superior and will offer multiple added layers of protection. As Todd mentioned, it should cost more as well. As Todd also mentioned, dropping the siding would be another way equivalent to this, however aluminum siding is generally impossible to R&R without damage.

Method 1 is recognized and acceptable, but not ideal in my personal opinion. I would not use that method on my own home. That said, we have done it before upon request. There are varying degrees of quality to this method in itself. A drip cap/head flashing should be retro fit, the window should be set in a wet bed of foam or caulk, etc... Many guys will simply slide it in and just caulk the outside, and in that form, it's is really a hack job IMO.

I don't think that method 3 is bad as it is impossible. Never seen anybody be able to "pry back" siding and tuck in the nailing flange. Isn't going to happen.

If there is access to foam it from the interior I could see it being acceptable, however not providing much benefit if any. The biggest red flag for me is that given its impossible nature, the guy recommending it sounds unqualified and I'd move on based on that.