ShannonCT
Deity
The choice of a second worker vs a settler comes up in most of my games, and I've found that the second worker is usually the better tactic because, though the settler is delayed, the second worker can help chop him quickly and when he settles you have an extra worker who is badly needed to improve the tiles of two cities and then to chop. (The benefits of two cities just doesn't kick in too powerfully in most cases without improved tiles, but establishing on a plains hill might tip this the other way. Of course, if we need an axe soon an earliest second city may be required. Do you have any more play time available to look at this?) In any event, I think we should hold off deciding on our second city site until after BW is researched.
I tried this out and I think your instinct is right. The first worker can chop the second, and then both can chop the settler. The settler is only delayed by 1 turn, and we'll have two workers.