I do think that everything should reduce to a single utility function. That said, this utility function is not necessarily a convex combination of separate values, such as "my happiness", "everyone else's happiness", etc. It could contain more complex values such as your v1 and v2, which depend on both x and y.

In your example, let's add a choice D: 50% of the time it's A, 50% of the time it's B. In terms of individual happiness, this is Pareto superior to C. It is Pareto inferior for v1 and v2, though.

EDIT: For an example of what I'm criticizing: Nisan claims that this theorem presents a difficulty for avoiding the repugnant conclusion if your desiderata are total and average happiness. If v1 = total happiness and v2 = average happiness, and Pareto optimality is desirable, then it follows that utility is a*v1 + b*v2. From this utility function, some degenerate behavior (blissful solipsist or repugnant conclusion) follows. However, there is nothing that says that Pareto optimality in v1 and v2 is desirable. You might pick a non-linear utility function of total and average happiness, for example atan(average happiness) + atan(total happiness). Such a utility function will sometimes pick policies that are Pareto inferior with respect to v1 and v2.