This is the best option imo. Its also the most realistic. AOE tanks is nonsense, as there is nothing like that irl. m40s are the cheapest most cost effective unit in the game, friendly fire is the better option, nerfing the best unit, making them needed to be used more skillfully would help balance the game.
I agree with the concept of having tanks like king tiger available sooner, muni lvl 11 or 12 comes to mind. Another concept could be tech that has tanks receive an extremely reduced amount of AOE damage(like 75% reduction in splash damage) while still taking the regular direct attac