You may have made a mistake somewhere. I've never seen it anywhere near that large before. If you like, try OPTION THREE again double checking each step just in case a mistake was made.
When I was repairing my Windows 8 install, which I only start up to do updates, the text file was 54 MB in size. There were bad files from all over. I did check the time stamp on the log entries and it appears to be just one SFC run, not multiple runs as you might have in that text file.
The DSIM did repair them all in one run and did require a reboot prior to running SFC again. During the restart I saw the same indications you might see during restarts for Updates with the Percentage showing during the shutdown. I was, of course, online during the DISM process so it could access the Windows Server.
In the Event Viewer I did notice I was getting Filter Manager errors. May not be relevant, but info just in case.
Filter Manager failed to attach to volume '\Device\HarddiskVolume20'. This volume will be unavailable for filtering until a reboot. The final status was 0xC03A001C.
Again, if it is relevant, this system is (was) using the small SSD as a cache for the HDD. (Smart Response)