The second interpretation is correct.
For the wolf, Bite is listed under Actions, as it is a type of Action. The next keywords are the important part: Melee Weapon Attack.
For a Player Character using Extra Attack, it states that you can make multiple attacks whenever you take the Attack action. For the wolf, Bite is a type of attack. Thus, in the case of a player character in the form of a monster using the Extra Attack feature, they can use any of the monster's attacks. These are distinguished by the 'attack' keyword, which are listed under the Actions category.
This is further supported by the language in Multiattack on page 11 of the Monster Manual:
A creature can't use Multiattack when making an opportunity attack,
which must be a single melee attack.
Thus, Bite can also be used as an opportunity attack.