Bumping this thread: I just read an article in Money Magazine (yeah, I know - financial porn). I gleaned one thing on the choice between pension vs lump sum: Most companies will give you the lump sum based on their average cost for the equivalent "annuity" (aka pension). Since they have multiple participants, they know the actuarial issues (how many will die young, how many will hang on to 98, etc.) Thus their average cost turns out to be much LOWER per person than if you tried to structure your own "pension" of equivalent monthly payout. So, right off the bat, they will most likely offer you a much lower lump sum than what would be required to cover yourself out to 98 (or whatever you figure is your date of demise.) For all their faults, Money does a better job of 'splaining this than I can so YMMV.
Ko'olau's Law -
Anything which can be used can be misused. Anything which can be misused will be.