I want to put the players in a challenging spot by putting them in a no win situation and having them captured and stripped of their equipment (assuming they might get it back as they make their escape, so as not to complete make the players mad.)
In crafting this no win situation, I did not foresee a way out that the players found through some creative genius. Something like instead of focusing their efforts on attacking the huge army in front of them the focus their efforts on luring them into a forest and bringing down the trees to crush them, or focusing on creating a rock slide again to crush them or at least block their path. (maybe not good examples but hopefully you get the point.)
Do you rearrange your story arc for creative thinking? Or do you crush their hopes and force them into the story arc you had originally prepared? Or probably the best route, as a GM hope they don't see a way out but prepare a secondary story arc if they manage to wiggle their way out?