The manner of his victory at Kempton makes the Ryanair Chase the "obvious route" for Cheltenham, although the option of running the ultra-tough chaser in the Magners Cheltenham Gold Cup remains open.
One of the stars of last season after winning the Ryanair under Bryony Frost, Frodon overcame a couple of knocks to his reputation this term when scoring for the first time since the festival in the Unibet Silviniaco Conti Chase on Saturday.
Nicholls is on his annual escape to Barbados and on Sunday he was still basking in the warm glow of Frodon's return to form.
"I was half expecting a big run and it's great to have him back in really good form," he said. "I'm delighted as I know he'll come on for it.
"People said he had underperformed this season but the Old Roan was a no race – he had 11st12lb and all the jumps came out [due to the low sun] – and we rode him wrong in the Betfair Chase by dropping in, as we thought Bristol De Mai would go quicker, and it didn't work out.
"After Haydock we found that he had grade four ulcers, which is as bad as it gets. We treated it and we thought we'd got him back to somewhere near his best.
"You could see at Kempton it's not his way round as he kept jumping out to his left and I always think he's 7lb better going left-handed."
Frodon can be backed at 8-1 for the Ryanair and 33-1 for the Gold Cup but the trainer will wait until he returns home to firm up plans.
"I was thinking at some stage that he wanted to go up in trip but seeing him win round there yesterday [over 2m4½f], perhaps it takes that away," said Nicholls.
"The obvious route is to go to the Ryanair and defend his crown, but we'll consider all the options. I know Mr Vogt would love to have a runner in the Gold Cup but the Ryanair is probably favourite.
"We'll decide whether we have a crack at the Denman Chase next month, as runs do bring him on as he's a stuffy horse, or go straight to Cheltenham."
A plan to head straight to the Gold Cup has already been rubber-stamped for Clan Des Obeaux, who landed back-to-back runnings of the King George at Kempton on Boxing Day.
"I'm very happy with him, he's in great nick and we'll start quietly picking him up," said Nicholls. "He'll have a racecourse gallop somewhere beforehand and we know how to get him right at his best now."
Fifth in last season's Gold Cup and a best-priced 9-1 shot for this year's race, Clan Des Obeaux won the Denman Chase en route to Cheltenham last year but this time will arrive off a much longer break.
"With these horses, you're learning all the time how to get the best out of them and he needs to be fresh and mega fit," Nicholls added. "His prep for the King George was great and he'll have an identical one for Cheltenham."