3) Fight to your front. Each stand fights what is in front of them. Stops the concentration of 4 stands of cavalry on a single unit (2 front to front, 2 corner to corner).
How does 4 stands of cavalry attacking 1 of infantry occur? I understand the cavalry frontage of 2cm vs the infantry frontage of 4cm, and that you can technically get 4 cavalry stands in contact, but this goes against the alignment of bases rules.
A cavalry stand should be placed centre to centre with the closest infantry stand (2cm frontage with the infantry stand). 2 cavalry stands can go to either side of it, with 1cm of frontage each on the same infantry stand, and 1cm 'hanging'. That's the 4cm covered, with no corners to attack.
With 4cm vs 2cm, there should be no way that you can ever end up with a 4 vs 1 set up of stands.
Vs any army without cannons, or similar rank penetrating weapons, aligning in columns always looks best to me. This is purely theoretical- I have next to no gaming experience yet.