Q: iPhone restore via iCloud or iTunes?

I just got my iPhone SE yesterday and need to get it set up. I would prefer to start fresh, but my understanding it this is not possible if you have an Apple Watch and want to retain your health/fitness data - you must do a restore.

I did an iCloud restore but it is taking for ever. My phone has done the initial restore part and I am using the phone, but almost no apps are on the device (all faded out) and there are many that are partially installed - the little pie animation is some percentage done.

Also, in checking some oneline articles about it, I went to Settings|iCloud|Backup. It briefly said my device was restoring, but now it doesn't, and the "iCloud Backup" toggle was switched to off. I did not touch anything on that page or stop the restore. I tried to turn the backup switch on, but the switch has been deactivated - perhaps normal in the restore process?

However, if I go to iCloud|Storage|Manage Storage, it does show my new phone and says "Backup options will be available when your iPhone is restored from this backup."

So one screen at least confirms a restore is happening. Also, when I am on my home screen, the spinning circle next to the WiFi icon is spinning, indicating something is happening, but it has been doing this for hours and it is making no visible progress.

So, my question:

1. Should I be patient and let it continue?
2. Should I just wipe the device, plug into iTunes, and do an iCloud restore from there?
3. Should I just wipe the device, plug into iTunes, and do an iTunes restore - I did back up my old phone twice before starting this - iCloud and encrypted iTunes.

Thanks for any assistance. Everything is on iOS 9.3.2.