Answer: A

Small Hint:

Evaluate each $\otimes$ expression from the inside out

Big Hint:

Keep the parentheses; the operation is not associative

Solution:

We can calculate it as follows. $$\begin{gather*} [(1\otimes 2)\otimes 3]-[1\otimes (2\otimes 3)] \\ = [\dfrac{1^2}{2} \otimes 3] - [1 \otimes \dfrac{2^2}{3}] \\ = [\dfrac{1}{2} \otimes 3] - [1 \otimes \dfrac{4}{3}] \\ = \dfrac{(\frac{1}{2})^2}{3} - \dfrac{1^2}{(\frac{4}{3})} \\ = \dfrac{1}{4} \cdot \dfrac{1}{3} - \dfrac{3}{4} \\ = \dfrac{1}{12} - \dfrac{3}{4} \\= -\dfrac{2}{3}. \end{gather*}$$

Thus, A is the correct answer.