One section of my 200+ year old house (southern New York State) has no foundation (wood sills on dirt). The cedar clapboard comes right down to the bottom sill, which has a little bit of concrete curbing added around it and alum flashing. Grade touches the house at the level of this flashing/sill. The grade is essentially flat, insufficiently sloped and conditions of the surrounding site are such that we can't really slope the grade more steeply to drain the water away from the house, but also don't want to build up against the clapboard.

We are considering two solutions: one to excavate the soil 12" or so and install a drainage trench with gravel (or filter fabric, pipe and gravel?) alongside the house, and extend the pipe to where the grade begins to fall off (about 30' or so). There is a roof leader at the corner which could also connect into the pipe. The second solution is to remove the bottom clapboard, build up cement-stucco over the sheathing where the clapboard is removed and build grade up 6-8 inches against the stucco to slope away from the house.

Looking for advice: not sure which would be more effective. Alternative recommendations also welcome as well as any guidelines for any solution.