To solve the problem, we are given two expressions:
We need to find which among the options given correctly represents these expressions.
Let's first simplify $L$ and $M$ using trigonometric identities.
For $M = \cos^2\left(\frac{\pi}{16}\right) - \sin^2\left(\frac{\pi}{8}\right)$:
Evaluating the given option $M = \frac{1}{2 \sqrt{2}} + \frac{1}{2} \cos \frac{\pi}{8}$:
Verification shows $M = \frac{1}{2 \sqrt{2}} + \frac{1}{2} \cos \frac{\pi}{8}$ is the correct expression when calculated step-by-step.
Thus, the correct statement is $M = \frac{1}{2 \sqrt{2}} + \frac{1}{2} \cos \frac{\pi}{8}$.