What did Edwin Hubble observe in 1929?
Combining measurements of galaxy distances with previous measurements of the redshifts associated with galaxies, Hubble and Milton Humason discovered a rough proportionality of the objects’ distances with their redshifts. In 1929 Hubble and Humason formulated the Redshift Distance Law of galaxies, now called Hubble’s law – consistent with the solutions of Einstein’s equations of general relativity for a homogeneous, isotropic expanding space. So while Hubble would probably choose the 4th option (which is not completely correct, since not ALL galaxies are moving away from us), the closer answer would be the 2nd option.