This is the comment I was going to make. I'm an engineering consultant 30+ years with my own company. I manage people and do technical work. I enjoy the latter much more than the former, but have yet to find a suitable replacement for myself.

I recognize that there are many very skilled engineers that have no interest in the decisions managers have to make. I pay them well to lead their own work while leaving management decisions to others.

From our many clients, the most successful and lean are those that follow the track you list above, as we do. Don't financially punish the gifted engineers because they want to continue to solve engineering problems, and not the equally important problems of juggling resources and setting project vs. development priorities (to name two).