You can't static_cast between references (or pointers) to "unrelated types." While you could static_cast from a CMyObject* to a CObject*, that isn't what you're doing here. Here you're trying to cast a reference to a pointer into a reference to another pointer. And the two pointer types do not have an inheritance relationship.
I like your "good case 2" code--I'd run with that.
For more details on the non-relatedness of your pointer types, see here: static_cast and reference to pointersstatic_cast and reference to pointers
