"B" uses both regen and engine compression braking, simultaneously, when the battery has room left for regen. Some energy is recovered and stored, some is thrown away in friction.
Yep, that is true. Using cruise control down hill has about the same effect. However, there does come a point at which the battery is fully charged and the energy gets dumped as heat. Perhaps that is what B. Roberts was noting???
I drive over the western continental divide once or twice a week, a total of about 1 mile of elevation changes. For best fuel economy I 'drive with load' (DWL.) The best tutorial on DWL is over at cleanMPG.com 'Normal' driving by wife yields about 50 mpg, while my games yield about 55 - 60 mpg.
Choose B when you know you will fill the HV Battery via regen on the downhill. By choosing B, it will take longer to fill the battery and your disc brakes will stay cooler. Why Change Brake Fluid