This is exactly the trap Uncle has set for the PRC. Well, it's heartening (if I were Uncle) to see the jingoistic diaspora spring for it.
Of course there are "options". You didn't even mention Hugo Chavez.
But IMO, Iran is the main drama and Taiwan is but a side show. Whether the US sells 100, 200, or 1000 PAC-3s make no real difference, except on Taiwan's Forex reserve. Doing a deal on Taiwan in exchange for "selling out" Iran makes the PRC look cowardly, short-sighted, and selfish.
PRC is better off "being honest" with Iran and get the h#ll out of the "six party talk" lest anyone harbours any illusions, and Iran then must adjust accordingly ...
I am not saying that the PRC should be carrying water for Iran on all occasions especially when the latter can't even seem to be able to stop wagging its tongue. But some things are more than bargaining chips if you try to see far enough beyond the horizon ...
Well, Hugo is for child's play. Do you really think the hermano could do sth serious to the yanks given its backyard geo location? Iran however is the key of the Middle East!
Face it, without serious comittment and long term calculation, was China really that dumb to have invested 100 bilion worth of contracts in Iran?
After "taking care of" Iran, with both Iraq and Afghanistan in his hand, uncle sam would virturally cut off entirely China's land access to the Middle East and Caspian Sea energy resources. In Chess term, it's called "dead checkmate"!
Don't kid yourself. Do you really think China would let Iran go underwater??
The current tw arms sale is not severe though, that's why boycotting related companies involved and suspending the current millitary dialogue appear sufficient.
Had it my way, a delegation would be sent to Tehran already to kick start presales negotiation of HQ 9 anti-air missiles. Yanks would think twice then on his tw deal. Nevertheless, anything beyond standard weaponaries would almost centainly ask for China's serious counter measures via Iran Card (another one is DPRK of course, albeit with some negative repercussions to China as well).
Make no mistakes. This kind of tit-for-tat tactics are exactly what yanks are afraid of! Anything short of that are for ladies. Remeber what Ruskis did to respond Poland missle defence shield pact? Strategic bomber flied by Alaska plus threatening arming Iran!
NO questions asked. Just watch.