Step 1: Understanding the Concept
Grignard reagents (RMgX) are strongly basic and react with anything having an acidic hydrogen or a carbonyl group.
Step 2: Detailed Explanation
Dry diethyl ether is used. Its oxygen lone pairs coordinate with magnesium and stabilise the reagent, and it has no acidic H.
Alcohol and phenol have O-H hydrogens that destroy the reagent (giving alkane). A ketone has a carbonyl group that reacts with the reagent. So only ether is suitable.
Final Answer:
Dry ether is the solvent, option (B).
\[ \boxed{\text{Ether}} \]