First, like was mentioned elsewhere in the thread, bounded utility seems to produce unwanted effects, like we want utility to be linear in human lives and bounded utility seems to fail that.

This is not quite what happens. When you do UDT properly, the result is that the Tegmark level IV multiverse has finite capacity for human lives (when human lives are counted with 2^-{Kolomogorov complexity} weights, as they should). Therefore the "bare" utility function has some kind of diminishing returns but the "effective" utility function is roughly linear in human lives once you take their "measure of existence" into account.

I consider it highly likely that bounded utility is the correct solution.