The answer should be "delighted". Offended and disappointed would be negative, and satisfied is only slightly positive.
The subject is defined as the "doer of an action". In this case, the answers would be C and D. So, who is only eight years old? The subject, that is, "my brother". Who is fascinated by bridges? The subject, that is, "he". He is used here only so as not to repeat "my brother" all over again, but they have the same meaning.
