This is pretty late but I just started listening to HDTGM and after watching Junior I was blown away that the most obvious (and sensical) ending to this movie didn't occur:
Pamela Reed's baby turns out to actually be Danny Devito's
Danny did get Pamela pregnant, but their relationship was too strained at this point, so she lied and said that she was knocked up by a member of Aerosmith
When she sees that Danny is seriously investigating the claim that it's a member of Aerosmith she changes her story to be one that's a lot less easy to fact-check
Over the course of time she falls back in love with Danny and sees that he'll be a caring father
The baby is clearly born early, implying that Pamela lied about when the pregnancy occurred
Pamela and Danny had had sex within the proper timeframe (and apparently without a condom -> RAW DOGGIN IT)
What makes this ending even better is that it leads to the following:
1. Pamela Reed's baby therefore has Danny Devito's DNA
2. Arnold's baby has Arnold's DNA (Duh)
3. Baby Danny and baby Arnold are born on the same day
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TWINS