How do I tell a student of mine she can't sing?

I have a bit of a dilemma here. I am teaching music and I have this student, a 15 y/o girl, who loves music, loves to sing and has been doing so since early age. She wants a leading role in our musical we’re putting together and she also wants to sing at our spring concert in June. But…she is absolutely tone deaf…

The way I see it I have three options:
1) Tell her to her face that she can’t sing and leave her
2) Try to make her realize that by herself by rehearsing together with her, record her on tape etc.
3) Give her loads of private lessons and hopefully, perhaps, if God wants, she might be able to hit a couple of notes at the end of the semester.

As it is now, it would be inhuman to put her on stage and having the entire school laughing at her…