The single challenge to installing tile for a 40 sq ft bath in this 1960 single-story house is the floor transition given the majority of the house flooring is in good condition.  The flooring consists of 1/2″ T&G plywood subfloor and 5/16″ mahogany floor.  That’s only 13/16″ – far from today’s standards but it’s adequate.  However, this creates a transition challenge for a tile floor built to today’s standards.  

The existing subfloor for the new bathroom’s is 1/2″.  The floor is supported by 12″ joists 16″ o.c. and spans 9′ – adequate for ceramic tile. 

Two possible options:
1) add 3/4″ plywood between the joists (just underneath the subfloor) supported by 2x4s running along and screwed to the joists.  Then new 1/2″ subfloor and 1/4″ backer board on top. That’s ~1 1/8″ or 5/16 above existing floors.
2) use Schluter (or similar) system on new 5/8″ bath subfloor (per p4. 2019 install manual https://tinyurl.com/y2cy2n53).  That’s about the same as above.  Less work but I think most tile mfgs want more subfloor.

Seems like the 2nd option is easier if I’ve interpreted the instructions correctly.  Any thoughts/advice?