Every morning my father likes to look at the _________ on the grass.

The correct answer is: Dew

The correct answer is option 1
Dew
'Do' means an action, the precise nature of which is often unspecified. 'Due' means expected to happen. 'Dew' means tiny drops of water that form on cool surfaces at night.
'Every morning my father likes to look at the dew on the grass'.
'Due' and 'dew' are homonyms.