I think 2 and 3 should be good. If you book it far enough in advance, you can always ask for a seat nearer the front. The tables, from what I recall, were somewhat set diagonally. In other words, the folks at the table in front of you shouldn't be blocking your view. It's a rather large stage too, so I don't think your daughters will miss too much.
The show was pretty good. I haven't been to an authentic luau to measure it against but it seemed like the children were enthralled. The fire twirler at the end is definitely a show stopper.

Another bonus is that for every scantily clad female dancer, there was an equally clad male dancer.

I'm all for equality!

(Don't worry, it wasn't anything over the top. I just like when they appeal to both the male and female audience members!)
One thing of note, that I did notice, they put whole pitchers of water at your table (typically at the foot of the table). I saw one little girl pick hers up and carry it around the table so she could refill her drink. Her parents almost came unglued since the pitcher was fairly large. They did manage to get it away from her, but you may want to keep that in mind if your daughters are fairly independent.
Of note for you and your husband: alcoholic beverages (such as Bud/Bud Light and house wines) are included in the price. Assuming you have a good server, they often like to refill these glasses (or leave new full ones) before your first is empty. Since my DFi isn't one to waste beer, he ended up having 5 beers before the dessert was even served.

I slowed the waitress down a tad after that.

He's got a good alcohol tolerance, so it wasn't a problem, but you may want to watch those drinks!
