Annnnnnnd I have another question about XDPS 012 Cyclops Sentinel. His special attack power reads:

ENORMOUS OPTIC BEAM: Penetrating/Psychic Blast. When Cyclops Sentinel uses it and hits, after resolutions choose one to affect a hit character and all opposing characters adjacent to it: Deal them each 1 penetrating damage -or- Give them each an action token -or- Knock them each back 6 squares.

Specifically, I am wondering what the order of events is when he choses "Deal them each 1 penetrating damage" and hits a character with mastermind. For example, if Cyclops Sentinel hits a character with mastermind (e.g., Red Onslaught) who has two adjacent friendlies, then the hit character masterminds the damage onto one of the friendlies (KOing it), do I then chose the order that the one penetrating damage is dispersed? Does the the masterminder choose?

Alternatively, what if I target one of the adjacent friendlies instead of the character with mastermind and KO it? If that figure is no longer on the map, can I still deal one penetrating to characters that were adjacent to it?

I know this is a super specific question, but there is an upcoming event where I know Red Onslaught will be run at 300, and I want to make sure I have my ducks in a row

Thanks for the help!

The instruction is pretty clear. You hit a character, deal damage to them, and after resolutions you choose whichever option you want. The 1 penetrating damage cannot be masterminded as it's not an attack, and if you KO'd the hit character, there is no valid choice to be made. Since after resolutions there is no hit character and thus no friendly that is adjacent to them, no valid choice.

If a character uses Mastermind they aren't actually hit. The current form of Mastermind doesn't just transfer the damage. It transfers the hit.

MASTERMIND
When this character would be hit by an opponent’s attack that deals damage, you may choose an adjacent friendly character that wouldn’t be hit by this attack and that is less points or shares a keyword. That friendly character instead becomes a hit target of the attack, even if it’s already a target (or would be an illegal target).

If the MM-ee is still on the map after taking damage from the attack, then the MM-er would be affected by the EOB After Resolutions effect.