Doors and Windows - New window installation - sill question

I'm about to replace some of the windows in my house with new construction vinyl windows. I'd like to retain the window sills for aesthetic purposes, but I need some advice on the best way to do this.

I've come up with two possibilities: 1) Install the sill at the bottom of the rough opening, cut the bottom nailing fin off the window, and set the window on top of the sill; or 2) rip down the sill and attach it to the outside wall of the house below the window.

Any advice on which of these options would be easier or better would be greatly appreciated; or if anyone has other suggestions, I'm all ears!

Thanks in advance!

It sounds like you are asking about an exterior trim under the windows. If that is true, then rip it down and attach it to the wall of the house. You don't want to cut the nail fin off of the window -- that is asking for a leak problem.