I'd think, go with the peoples wishes on 1&2. I'm not suggesting you seek permission from everyone concerned but if someone did object, I think dropping that song would be in order.

I'd guess a key point in how to think about it could be what the terms were when you recorded. I've been in a few sessions for example where there is a recorder(s) running but even though I have one and use it once in while, I find their presence a touch off putting. My general belief though is that people (including me) want to get the tune down for learning within the group and the thing is fundamentally a private affair. Personally, if I believed my every bum note, etc. was to be recorded for public posterity, I'd down tools and drink at the bar for the rest of the night.