Hello Karl-WE , neither of those options cover the functionality of WSUS. As exchange12rocks has pointed out, WSUS is a server side approval and distribution system that gives your fleet a single point of update management and reporting. PSWindowsUpdate runs on the client side, has no reporting, has no common database of update approvals, and is simply not designed for managing a fleet of systems. Perhaps it's possible for somebody to write a script that makes use of PSWindowsUpdate for fleet management in some sense, but it won't have nearly all the features of WSUS.
All Delivery Optimization does is make more efficient use of bandwidth.
The alternatives for this are either new expensive cloud solutions or SCCM, which is also expensive.
I'm open to new ideas, but WSUS was deprecated without there being a low cost alternative.