OTM calls are super expensive because the IV is through the roof (it has been over 700% most of the week).

However, if Melvin had picked up deep OTM calls before the (literal in both senses) volume started ramping up about two weeks ago, they might have done a little better.

To be clear, I don’t actually think they did.

And even if they did, who's on the other side of those options now that they're in the money?

Could be anyone. What matters is whether they're covered calls or not. I don't know if that info is available. If it's a covered call the seller of the option has the shares, so they essentially sell them to whoever bought the option and decided to exercise the option. If they're not covered, then they have to go out and buy them.