In Act 2 of The Alters, you’ll be face with a decision on what to do with Molly the Sheep after her sudden death. At this point, the game will present you with three different options. This makes it seem like it’s a major decision.
Fortunately, if you’re worried about picking the “wrong” choice, here’s actually what happens.
The Alters – Molly the Sheep Choice Guide | Cremate, A Proper Burial, Or Bring Back To Earth

During the game, there is a part where you get to create a clone of a sheep, which your character will then decide to call Molly. This quest is actually a part of the demo as well.
At a certain point, you will get a choice between cremating her body, giving her a proper burial, or trying to find a way to take the sheep back to Earth.
Well, the simple answer is it doesn’t matter. All of the choices will lead to the same outcome, and the reason for this will be revealed later on. Just know that no matter what you pick, it will have the exact same result, so just pick whichever you want.

Does this affect the story?
Although the game presents three different options, this one doesn’t really affect your playthrough at all. So regardless of your choice, the story continues in the same way.
This choice is mainly there to reflect how you want Jan to respond to the situation. The events that follow after will still happen regardless of which you chose.
And that is pretty much everything you need to know about Molly’s Fate in The Alters. Again, since the outcome will always be the same, just pick whatever option you want based on what vibes you think the protagonist would have at this point in the story.

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