First, you may or may not find https://en.wikipedia...wiki/Tama_(cat) an interesting, if somewhat unrelated read. Might give you some inspiration.
Onto the actual thing, I don't think either of the possible story paths are that interesting myself. It's already such a fascinating town, one that purposely keeps on that charade, that it makes you wonder whether the only sentiment behind it all was the desire to bolster tourism/profits or something more. There's no need to add more story elements to make one side or the other a villain. This idea doesn't need that. It could be a touching story about the many incarnations of that cat and what it meant to its various owners over time or something. Or maybe the cat falls ill under their coverage and the two reporters get roped into the town effort to keep it alive. Or said two characters might spend a portion of the story debating the semantics of a tourist attraction.
As for the ending, it really depends on one fundamental question to this idea. Whether it's fine to keep up the charade or not. It may feel like it's absolutely certain that it isn't, but try to think about what you want the story to convey and why.