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2 is incorrect because and in the relative clause who was born in Germany and a naturalized citizen of Switzerland indicates that the two descriptions/items need to be parallel (in the same form). In other words:
who... 1) was born in Germany
who.... 2) a naturalized citizen of Switzerland
In the correct answer choice, 1, the two items are parallel, i.e. in the same form (a noun and a noun).
native of Germany and naturalized citizen of Switzerland