This question is testing recognition of the classic triad of a specific ANCA-associated vasculitis from its lung and kidney findings.
Anti-GBM disease: gives diffuse alveolar haemorrhage with widespread lung infiltrates, not discrete cavitating nodules, so it is ruled out.
Churg-Strauss allergic granulomatosis: needs a background of asthma and eosinophilia and rarely causes cavitation or severe renal disease, none of which is mentioned here, so it is ruled out.
Systemic lupus erythematosus: can cause red cell casts from lupus nephritis but its lung disease is pleural or interstitial, not cavitating nodules, so it is ruled out.
Wegener's granulomatosis: multiple cavitating lung nodules plus a pauci-immune glomerulonephritis with red cell casts is its textbook presentation, and it is the classic c-ANCA/PR3-positive vasculitis, so this is the correct choice.