I highly recommend Design B, as it is the most logical and shows the user it's options in greater detail. I think that saving the user an extra click is far less important than having them explore more possibilities in greater detail, with the only downside being as small as 1 extra click. This is also the most logical, thus being more compatible with the user's natural thought path, leading to an overall more 'compatible' user interface, rather than saving the user a mere click.
