Thus spake Hanna Burdon:
"2. die besten Märchen, die es gibt ("the best fairy tales there are")"
"I would use no 2. It seems best to stress both, but stress them differently."
Thanks for answering, Hanna. As it happens, you chose the one I put in there for completeness. The quote is the German, which requires quotation marks. It is in a foreign language, thus it requires italics.
The problem for me was the English. It is a translation of something the reader already knows is a quotation, so are quotation marks still required?
I think I am going to choose my third option:
" die besten Märchen, die es gibt " (the best
fairy tales there are)
Simon R. Hughes