What would expel more energy?

Discharging fully charged lithium battery or setting it on fire and using it as a heat source?

Setting it on fire. The fully discharged battery still contains a lot of chemical energy.

Need answer fast?

No, why?

Fire. Afterwards all that is left is ash. After discharging battery, you still have a dead battery.

Would there be a difference in severity of fire between charged and discharged battery (i.e. can this energy be expelled in form of heat and not just through normal operation - electrical energy)?

Yes. They are just chemical redox reactions in a cell constructed so the transfer of electrons has to go through a wire. You can do the same with reactions we directly think of as fire, such as a hydrogen-oxygen reaction, in a fuel cell.

Since the answer was given above, the following is an addition :

For engineers, the amount of energy is equally important as the quality of the energy. And the quality of the energy that we are most interested in, is it’s ability to do work or transform into another form of energy.

For example, 1 pound of water heated to 200 degrees has the roughly the same amount of energy as 4 pounds of water heat to 50 degrees. But the former is more quality energy. The scientific term is exergy or available energy.

The higher the temperature the higher the quality of energy. Electricity and radiation has almost infinite thermodynamic temperature, since they convert to work with almost 100% efficiency.

So for the battery, the total energy maybe more when you burn it. But the available energy maybe (repeat maybe since I have not done the calcs) more when it is discharged.

Asking “Need answer fast?” is an in-joke around here. Usually made when needing an answer fast is unlikely.

IIRC the electrolyte is typically something like proplyne carbonate, which is inflammable. So you’ll get energy from that.

Yes, like naita says. In a similar way, dissolving a spring in acid produces a warmer result if you wind the spring up first.

While energy conservation obviously holds, I considered it to be quite possible for particles still holding charge to fly away with the smoke (and taking energy with them).