I don't think Picard would ever consider the Borg the lesser of 2 evils.
Placed in a situation where he has to pick an ally between both a new form of life and the Borg, which he personally hates beyond reason (First Contact hasn't happened yet by the time of Scorpion, he's still in full Ahab mode), he'd choose the new form of life, even if initial contact proceeded extremely badly (who takes the role of Kim? Unnamed redshirt #157632? Riker?*) due to a misunderstanding.
Even with Troi (taking the role of Kes)'s warnings of the Undine's intentions, he wouldn't consider it sufficient to antagonise them.
Besides, from a literary point of view, I'd think that's a more interesting angle: instead of just having Picard/the TNG crew proceed slightly differently but to largely similar results; have the story unfold on a completely new perspective.
Namely, the alliance being between the Enterprise-E and the Undine and see where it gets you.
Don't pre-write the ending, just have characters behave as they normally would and see what happens; regardless of positive or negative outcomes.
*standard TNG away team in possibly conflictual situations: Riker, Worf, Data, 0 to 2 redshirts.