Stout...I would favor the flexible bag option...below the water line. Nothing is ideal...but sooner or later a joker valve will need to be changed...by you...and an above the waterline tank would make that worthy of a U-tube video! (G)
By the way...try over at sailboatowners.com forums. Peggy Hall there is probably THE most knowledgeable person around about head systems as she was the "Head Mistress" at Raritan for many years. She will give good advice and probably will give you good sources for minimizing the stench in your installation.