I believe the sweet spot can be a combination of those techniques, keeping it in that perspective but zoom out a little bit and use it's tentacles as arrows, so they will extend to the enemies that are close to it.
I can add a 3rd camera option with a minimap as suggested.
Glad you liked the idea, I was coding another game, and by Wednesday it did not felt fun, so I started again doing this one, those days lost would have been useful, but well, you live and learn.