I’d say the second, but then you might say what if someone plays overly careful and doesn’t get hit :P, well that’s a bad game design, there should be stuff to challenge all sorts of gameplay styles 
That’s why I also still think there should be a system which rewards good play as a result, simply by making every hit count (stagger bar, things like that), or even just give regular mobs a considerable amount of damage, not only elites have to hit hard you know, as long as you have good ways to engage/disengage this should be no issue IMO tbh