I'd rather define my db domain in-code so I do not have to worry about writing the queries without type hinting.

Raw sql -> eh, I don't have the patience Raw sql w type hints -> better, I at least get a compilation error when I do something wrong, and preferably a suggestion ORM -> this usually introduces it's own abstraction that needs it's own maintenance, but at least it's more code-oriented.

Yes, SQL is an awesome solution to querying DB's, hence I prefer option 2

Well yeah, of course. Sorry, when I said "DB" what I should have said was "data-layer," and this can include: repositories, ORM models, query-builders, etc. All of these are type-hinted "db domain in-code" and, still, not one coupled to your API.