World War II was in practice not a choice. The timing is a choice. But basically once Hitler controls Germany, it's going to invade its neighbours and it's going to win, and the UK only has a choice of whether and where to fight - if it won't fight it becomes at best a client state, taking orders from Hitler's Germany under threat of invasion once the Germans control mainland Europe. Eventually it will be under German control de facto.

For example, as a party to the war, Britain's navy is of course entitled to fire upon German vessels, or ostensibly neutral vessels clearly operating under German control, in the strait. This capability makes Sea Lion (amphibious invasion of Britain) essentially suicide, German troop barges would be destroyed by British Navy vessels, and even if some of the British vessels are damaged or destroyed in the process the manpower losses for Germany are devastating. However if Britain is not a party to the war, those troop barges can just cross the strait unmolested, with no naval support - right up until the troops disembark and begin seizing control of British ports.

Nah.

Once they enter territorial waters, and not engaged in 'innocent passage' they are legitimately a target for us to defend ourselves against.

However in 1939, that would have been around 3-4 miles off the shore, so your point largely stands.