A good ending where a character lives on should feel like a beginning, and this one doesn't. So they should expand on the "go to Avernus" option. At least show us that this is, in fact, a beginning of a new story. Show us a scene with them stepping out of a portal, taking up their new lives in this inhospitable place, but well, Karlach has always been good at survival, and now there are two swords instead of one, so that's fine. Maybe give a hint that they might find a permanent solution to her problem here where they make the stuff her engine is made of. As it is, with things just stopping, it is not satisfactory.
Meanwhile, I also think that "Karlach dies here" is appropriate as an ending. Karlach is a woman who lives in the present. Death comes for us all so why worry about it until it actually does. It is an attitude that fits her and calls back to the old heroic fantasy stories, expressed so vividly by Valeria in the old Conan film, calling out "do you want to live forever" as she jumps from a tower into a pool of water which may or may not be deep enough to survive the jump. It is a reminder that all good things come to an end, and it is telegraphed early enough to the player, so you can adapt to its possible inevitability.
I think your first paragraph is certainly one solution. Involve the House of Hope (presuming you did that, and got the good result there), it has portals to every span of Faerun. Given the player some sense of positive enforcement, and closure for the ending that seems to be the canon/best ending (given Karlach choosing it when you play as her, and choosing it when Tav tells Wyll its her choice.), that said, I still think the fact that a solution (Gondians, Steel Foundry) being wafted under our nose is unjust. A "new beginning" (living on, as you say), could've been addressed in endslides or some such that seem to be glaringly missing from this MAJOR CRPG title. Something that shows Tav, Karlach (and the gang, possibly) gearing up for another adventure, a new adventure now free of this doom. Ready to take up arms for the next cause out there, or have a life together. Optimism really matters, and the fact that it all ends so abruptly is a real gutpunch.
