Step 1: Use the hyperbolic identity.
We know that
\[
\cosh^2\theta-\sinh^2\theta=1.
\]
Hence,
\[
\sqrt{\sinh^2\theta+1}
=\sqrt{\cosh^2\theta}
=\cosh\theta,
\]
since
\[
\cosh\theta>0.
\]
Step 2: Simplify the logarithm.
Therefore,
\[
\log\left(\sinh\theta+\sqrt{\sinh^2\theta+1}\right)
=
\log(\sinh\theta+\cosh\theta).
\]
Using
\[
\sinh\theta+\cosh\theta=e^\theta,
\]
we get
\[
\log(e^\theta)=\theta.
\]
Step 3: Write the final answer.
Hence,
\[
\boxed{\theta}.
\]
Thus,
\[
\boxed{(C)}
\]
is the correct answer.