#2. Conjuncts are supposed to look, well, conjunct.
I guess any profficient Devanagari reader would readily understand that #1 is still a conjunct, due to the lack of a vertical trace after the SHaa. But it would cause an unnecessary mental blip.
Well they are supposed to be joined together when it is possible to join them together, but plenty of Devanagari conjuncts are properly formed without any joining at all, for example ण्ट and श्क. Now in the case of ष्ण a join is possible, typical, and desirable, and the absence of a join is a flaw in the font, but it is very unlikely to cause people problems in reading a very common word like कृष्ण. Similarly I like to make my श्व like the one on the left, with a join, but I think there are certainly some who would prefer the one on the right!
Also, while ष्ण should be an easy one for most half-decent fonts, I'd be very interested to know how ष्प्र and ष्ट्र्य (
ṣpra and
ṣṭrya) show up for you? What about ब्भ्य (
bbhya) and ब्ज (
bja)?
Honestly also, I don' t understand the need of all this image manipulation, the default rendering of the conjuncts by any computerized font is quite graceful. Just to to
Google Input Tools/ Hindi, type "hare krshn" , and copy that!
Alas no, not any font, not any font at all. The ligatures add a lot of additional work and complexity to a font, by no means do any and all fonts handle even simple ligatures like ष्ण. It's likely that even the most rubbish fonts will go out of their way to provide common but special ligatures like श्र, क्ष and ष्ट्र, but providing all the possible combinations of ष् is a lot of work, work that won't necessarily be done when ष् is close enough. You just don't get enough benefit out of all the extra work. And indeed, as a Sanskritist, I spent a lot of time finding very, very good fonts that have incredible ligatures like
ṅgdhve and
ddhrya, but even these often use a disappointingly rough combination with the
i diacritic (e.g. त्स्नि) because it would be even more work again to provide bespoke characters for every combination with
i. (Although what you could do is make all of your glyphs fit one of a small number of sizes, like you could have ten possible sizes (say) for your glyphs and all glyphs in your font would have to be one of those sizes. Then you'd just need to make ten matching
i shapes and you're good to go, but that would be quite restrictive). Anyway, as I say, some fonts do not have a bespoke ष्ण ligature. Lohit Devanagari is one:
And this is the standard Devanagari font for Ubuntu and was used by Wikipedia (
Lohit fonts - Wikipedia). And if the OP is required to use a font that doesn't have it then OP is required to use a font that doesn't have it.