Do you think the hosting location of the website matter? I mean, if you wanted to rank for Japanese KW, getting backlinks from the same country gives Google a stronger local signal?
they actually do, domain ccTLDs, website location & language,
pretty much as giving you a boost & more authority locally, they would pass it to your main website as well,
the thing is about available choices,
if i got the choice to get some solid link from an english website or some average link from a language relevant one, i would pick the english,
it's an advantage, just a part of the overall link worth which can be taken down if the other website is getting more advantages,
better overall authority, more RDs, lower OBL, better overall content, niche relevancy, how the page is closer to the main page, etc... everything should be considered,
2. Can you elaborate on the reasons as to why you'd pick '1 or 3' and the reasons behind you saying 'it won't work well' ?
Is this purely based on your personal experience, gut feeling or do you have any solid background for claming such?
depending on the niche and keywords used for a different language website, the website niche/keywords can be treated as totally different niche by Google,
that's almost like linking from a "pet" niche website to a "phone" one, that's not as good as a niche relenvat one,
people think that the algo/google is smart enough to know they're actually the same in translated language, but it's not always the case,
hosting a foreign language page in an english website is also spammy as pointed out before,
by the same logic, it would be a totally irrelevant article linking to some random website,
the same extend for the PBN anchors, links, etc... which are linked to your main niche/language and gives another advantage with that,
i've had experience with different niches in different languages if that's what you're asking,
both multilanguage & 1 language niche websites trying different choices & making small tests here and there,
i certainly don't have enough data to swear by it, it's tiny compared to the whole scenario, it would require mass analysis instead of just case studies/experiences,
but i've had the best rankings/boosting by using both niche/language relevant links