The correct answer is A because I fed the question into OpenAI's GPT-3 model, which told me:
"No, Peyote Church's freedom to practice their religion has not been unduly burdened. The state has the right to regulate activities such as gambling and lotteries, and this restriction does not unduly burden the practice of the Church's religion. In most cases, the Church could find other ways to raise funds for the parsonage."