Actually, I think I found the answer for use case 2b: Remove IP address
The Adobe documentation says: Checking Remove IP address replaces the IP address with x.x.x.x in the data, after geo-lookup.
So I guess the geo-segmentation reports will still work.
I now believe that use case 2a will obfuscate the IP address (e.g., 234abc6493872038) after the geo-lookup as well but would really appreciate to get it confirmed as it is not in the Adobe documentation.
I don't fully understand why with use case 1., we lose the "city" as the replacement of the last octet could have been done after the geo-lookup, exactly like for the IP Removal use case...maybe Legal reasons? Strange...