I can't add to your specific issue, but I cannot for the life of me get a clear answer on the difference between these two options. I'm thinking that Lars Breddemann might know.
I checked the following link, and it seems to me that you can now create an AP that is either the standard version OR a SQL version but I am not getting the options mentioned in this workflow through the modeler perspective.
Create SQL Analytic Privileges - SAP HANA Developer Guide for SAP HANA Studio - SAP Library
I assume the major difference would be that the AP is defined either the traditional way or through SQL directly, but I don't see why the method needs to be chosen at the design time of the view?
Regards,
Justin