I say Massa-choo-zits and apparently this is fairly unusual.
I should think so. I lived in Massachusetts for five years and the locals never said anything other than Mass. Where you from? Sommavul Mass. Hingham Mass. Woostah Mass. Like that. That was in the eastern part of the state, though. maybe it's different out in the Boondocks and BerkshiresBuckshuhs.
The voiced sibilant is common enough, though. I noticed that folks from all parts of New England pronounce Qunicy as Kwinzee. Joseph and Houses are given the voiced sibilant there also. I think that might be the case in Old England as well.
I did notice that everyone around Boston calls a water fountain a bubbla and a remote control a clikka. Gimme dat clikka.
Anyway, I say Massa Chu Setts. (unvoiced sibilant.) Sort of like your first choice but the vowel sound in the last syllable being setts, like it is spelled, not sits.
FIFY
I lived in Wall-Tham (equal accent on both syllables) for 8 years during grad school. It was my first time out east, and to my Midwestern ears the language of Eastern MA might as well have been from a foreign country. But I learned how to say and spell the state from a recording played on Captain Kangaroo. There's no z.
Until yesterday, I thought Berkshires were pronounced "burk-shyres" or at least "burk-shures", but this guy says "burk-sheers".
The further east one goes in MA the less r I hear after vowels. In western MA I could expect to hear some r in the word. In Down East ME the r really vanishes like in BaHaba, except where it isn't supposed to be as when I've heard that the state capital is Uhguster.