Usually the second, which is the most common option, because we know objectively that studios are in fact not “losing” eleventy billion dollars to piracy. If that were true most people would choose the first.

I’m not buying the new Pokémon game. I’ll play it on an emulator if it’s not too much hassle. I don’t have plans to ever buy it, and if it never works on emulation, I will just not play it.

In a different case, I’ve gone from pirating a bunch of games to buying them because I liked them and wanted the updates. BG3 for example.