One of the use cases for side_effect is for dynamically changing the returned value based on input - so your option 1 just doesn't work.

Using two line functions would make your code easier to read, and then your "workarounds" would look natural instead of awkward.

Maybe return_value should take precedence over side_effect if both are set.

It would probably be more pythonic to raise an exception in that case - although that would be annoying if you're just reconfiguring a mock. I've also written side_effect functions that accessed the return_value, which is probably the genesis of the current API.

As you point out, both your suggested changes are backwards incompatible, so I'm closing this issue.