> I suggest to not use "pyc" and "pyo" in options, because ".pyc" and ".pyo" filename extensions
> are specific to a subset of Python implementations. Jython uses "$py.class" filename extension
> (module$py.class for module.py).
But these are extension modules, not Python modules byte-compiled for caching, are they?

> You could use --byte-compile, --no-byte-compile and --optimize-bytecode (or --optimize-byte-code)
> for both build and build_py commands.
I like the first two names, but still think that --optimize-bytecode might make people imply that the option is dependent on (or implying) --byte-compile.  Maybe it’s just me; I did not read the source for these options closely and was under this misconception for months.  OTOH, even with one maybe possibly ambiguous option name, I can still make the help text clearer (i.e. “byte-compile Python modules” and “byte-compile Python modules with optimizations”).

(We’re spending a lot of thoughts for a very marginally useful feature (.pyo files).)

> Do settings from setup.cfg affect byte-compilation?
Yes.  Like any command options, --(no-)compile and --optimize can be given in config files or on the command-line.

BTW, why don’t you want byte-compiled files on your system?