Passing object in routing.yml
What you are looking for is now called upcasting, the handbook page is https://www.drupal.org/node/2122223 

I do not think options is necessarily for entity upcasting. For example, check the node.type_edit in core/modules/node/node.routing.yml for a routing definition not using any options (or user.admin_permission in user).  

As with your previous question, I wonder whether your entity class properly defines its storage controller? If you have a debugger, the parameter conversion happens in core/lib/Drupal/Core/ParamConverter/EntityConverter.php