It's an easy question imo. Given our financial situation we should choose the cheaper option. Also, looking into average attendances, there's no need to expand the seats as the board proposed.
Not so sure about that. Personally, I'd welcome the idea of extra seats with open arms. Nowadays it's nearly impossible to find a ticket for a high-profile-game (eg Clasico, CL-SF, etc.) at a decent price, because the demand is way higher than the supply. In case of extra seats, that would be evened out more nicely (I hope
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Also, if I remember correctly, if you want to apply for a season-ticket, there's currently a waiting-list of 20 years (or something like that). That's immense, and it could be greatly improved by adding additional seats.
It's true that the average attendance can be rather low at times, but that's because season-ticket holders don't free up their seats (when they don't plan to attend a particular game), and thus the non-season-ticket holders don't have a chance to buy a ticket for that particular game.