I agree a roundabout is a bad idea given the restrictions on space available for a suitably large one to handle the volume of traffic - I've used many roundabouts on my way to the Jersey shore and work well for those who know how to use it-not something I would trust our tourists to have. Alas, I don't think a traffic light is a good idea either for the following reason - not much traffic on 30a heading east trying to turn north on 395 will be able to cross against the west bound traffic causing massive back-ups on 30a while South bound on 395 will be able to move smoothly east or west. Adding a left turn arrow for those folks wanting to go north will extend the time spent at the light and it would only take the first car wanting to continue east to close the arrow thing down. A long left turn lane would be needed - could the land be made available? IMO there is not a VIABLE OPTION FOR THIS INTERSECTION and should be left as a 3-way stop.
More North/South roads to 98 would be the answer but I think this was approached with state by St. Joe already to go through state forest land and was rejected. The environmentalists would organize against this.
Sorry to be so negative but in the name of doing something/anything the politicians will push this with the result that the law of unintended consequences will emerge (something gov't is exceptionaly good at producing).