Mc is certainly not a self insert in the traditional sense, and the top option is fully implemented :)
I feel like the MC has shown pretty clearly that he's not a blank slate you're meant to take on the role of. That being said, you are obviously free to choose whichever you please, but I do hope the MC made it very clear the consequences of picking either option. The option is greyed out because it locks you into a... let's say 'less than savory' ending, and isn't meant to be picked on the first play through because of ramifications, even if it is fully implemented.
People are more than welcome to make a "bad" choice! It's their choice! That's why it's implemented in the first place instead of me waiting to release that scene until after the vn was finished. I just figured this was a good middle ground of "You're not supposed to go in that room, but if you REALLLLLY want to, you can."