Which mode for baking cake in microwave?
There is not a straight "yes" or "no" answer to your question. 

First, an oven which cannot turn off its microwaves cannot replace a normal oven. Any recipe meant to be baked in a real oven will fail if it is exposed to microwaves. So alternatives 1,3 and 4 are out. Option 2 also won't work, even if the microwaves are truly turned off, because the cake will not rise and stay raw in the middle. You cannot bake a cake without a bottom coil. 

For the "yes" part, there are recipes which are specifically designed for microwaves. They are more muffin-like, and most of them have to be eaten while hot. Also, if you are making them, you have to give up on the whole variety of texture which is possible with cakes and make this one specific type. But if that's enough for you, do it. You will have to search recipe databases for "microwave cupcake". Just don't try to take a random cake recipe and bake it in the microwave. 

If you try a microwave specific recipe, then the pure microwave setting will be the correct one. The power choice will be given by the recipe. 

For some more detail, see also this question, this question and this question.