Rebaseline issues

All,

My project has approached to 87.86%. at this point, there are some not-started activities (equipment relocation) have been decided by the End user and the management to be put out of the scope. that means I have to remove these activities from my schedule(baseline and Actual). my planning department boss suggested me with the following:

1. totally ditch my Previous BL.

2.remove all the equipment installation activities in the actual schedule(datadate:22-Feb-2013).

3.apply 2 as new baseline.

4. for s-curve, replace all the previous plan MHS with actual MHs till 22-Feb-2013.(he told me that replace previous plan with now actual is the fundamental rule in rebaselining.)

5.for the period after the datadate(22-Feb-2013), use 2 as baseline to get from p6 cumulative BL Manhour Units.

6.then use Excel to draw the Curve.

another Colleague has very different opinion, he suggested since our initial baseline(datadate:9-April-2012) is not obsolete. why not do the following:

1.remove the equipment installation activities from the baseline.

2. update the baseline to actual(22-Feb-2013).

3, Draw the curve.

or he said, more easier, we would delete the activities in actual and make it as baseline, but no 4th step as suggested by the first peroson, he though it was obsurd.

i need you experts' insight. how can i proceed now?