#1
You are right: Ned4 is better.
Not that it matters much: white is a pawn down and should lose either way.
Why this move is best?
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In this situation,Nfd4 is best.But I think Ned4 is best,because knight in f3 is protecting dogface in e5.If you sent it to d4,dogface will in danger.And I think f3 is better then e2 ,so knight in f3 is more useful,I don't want to trade it.What about you?