What are the pros and cons of different ways of passing HTTP POST parameters to a REST API?

TL;DR - JSON as HTTP Post Body is the best way. Three options in the question demonstrating three ways to encode data. We can encode (flat) data as form parameters (1), we can encode data as JSON (2) and then we can do both (3). Obviously double-encoding data makes no sense, so 'Passing in JSON as form parameters' is out. Comparing (1) and (2) I would prefer simpler solution and it is 'passing in JSON as the request body'. It is not only simpler, but also have better support for nested data. Additionally to that I would like to add that it is important to realize that that POST is not idempotent (see http://en.wikipedia.org/wiki/Idempotence). One should see POST as a HTTP Verb addresses do a particular resource, and in case of failure re-POST is not expected or better to say failures should be handled with extreme care by POST requests.