That's only because relative time dilation is measured with respect to the instantaneous inertial frame which is by definition Fermi-transported so you're forced to use case A. In other words we never consider case B for relative time dilation since case B involves a frame that isn't Fermi-transported.
However the exchange between Ben and I was regarding two slightly different cases from yours. Here we have A as the central observer whose frame is corotating with the uniform angular velocity of the circular orbits. In this frame all the observers in the circular orbit are at rest since it's corotating and the relative time dilation manifests itself as a pseudo gravitational time dilation. In other words the observers all have constant spatial coordinates in this frame.
Now consider an observer B in a circular orbit. We have two relevant choices of instantaneous rest frames for B. There's the instantaneous inertial frame and there's the "natural" rest frame of B adapted to the symmetries of the circular orbit. The first corresponds to a Fermi-transported frame and the second corresponds to a Lie transported frame. In the Lie transported frame of B, all neighboring observers in the family will be fixed in space at each instant because the entire family of circular orbits is described by a twisting time-like Killing field i.e. Born rigid rotation. Because of the twisting and the rigidity we can conclude that the Lie transported frame rotates relative to each instantaneous inertial frame (Fermi-transported frame) with some angular velocity (if we ignore gravitation then it's just the Thomas precession rate). So in the instantaneous inertial frame of B the neighboring observers circulate around B (more precisely, relative to the gyroscope axes of the inertial frame) at that instant with the Thomas precession rate.
In the case of Born rigid (uniform) linear acceleration, the "natural" rest frame and instantaneous inertial frames coincide; in principle I can equip each observer with a rotating frame instead, wherein neighboring observers in this Born rigidly accelerated family do not have fixed spatial positions anymore, just for the heck of it but, as noted above, the relative time dilation factor is always calculated in the instantaneous inertial frame for obvious reasons.