I like both and I absolutely love the background color with this particular dog. I do a lot of portrait type shots working a lot with "head" breeds, but I do go both ways - try to get the crop in camera and also back out and chose what I want later. I do take tons of shots both ways and let the owner chose which they like. 9 times out of 10 -- at least for me -- they are choosing a head shot and not a full body shot.

My one comment on #1 is that I would have chosen a different crop. For my tastes, the dog is cropped to close on the left side. I would like to see more of the arch of neck leading down. Not a lot, but my mind's eye just wants to see more on that side and there is a gorgeous arch of neck to work with. I also would have cropped the cushion totally out on the bottom, which at the same time would have removed the hint of the missing leg down there.