In my experiences...a little bit of it all, depending on the flight event.
Specific examples from my most recent organization...
A) PNF reads Landing checklist item "Floats" when landing to a runway...PF (or PNF in some instances) responds "not required". No verbal or visual verification needed. Continue with checklist.
B) PNF reads After Takeoff checklist for "Landing Gear"...either PF or PNF can retract the gear (i.e move the lever) with a verbal response of "up". The P not performing the action can visually verify, but verbal verification not required. Continue with checklist. PNF Gear up visual/verbal confirmation is a few steps later.
C) The 'intent' of the entire "Before starting engines" thru "Systems check" was the challenge-do/call-cross check, although it was mostly performed as your description of (B) due to speed of the two experienced pilots & requirements for a quick launch response. This method, (C), was very deliberately used for initial training yet begins to fade as the newer pilot became more proficient with switchology. Not the 'right' way, just what tends to happen. Improper switch positions & failing to verify during run-up was a common "gotchya" on checkflights used by evaluators.
That organization also had used "Static" or non-movement checklist items where (C) was used primarily, and "Movement" checklist items where (A) or (B), & sometimes even (C) were used.
I think checklist flexibility should be required...not too keen on detracting from the PF's attention of basic flying for something "unimportant" for doing or verifying, say, position lights (probably an extreme example, hope you get my point).
Just my 2¢ (which is worth even less these days)
Hope those examples help a bit...