Step 1: Let the fixed points be \(1\) and \(2\), and the lengths of strings \(P\) and \(Q\) be equal to \(L\).
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Step 2: If at every instant \emph{one} of the two strings is fully stretched (taut), then the red dot always lies at a point such that:
\begin{itemize}
\item Its distance from point \(1\) is \(\le L\),
\item Its distance from point \(2\) is \(\le L\),
\item At least one of these distances is exactly \(L\).
\end{itemize}
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Step 3: The locus of points at a fixed distance \(L\) from point \(1\) is a circle with center \(1\).
Similarly, for point \(2\), it is a circle with center \(2\).
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Step 4: The path traced by the dot is the outer envelope of the two circles of radius \(L\) centered at points \(1\) and \(2\). This envelope forms a smooth, lens-shaped curve.
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Step 5: Among the options, only Option D represents this lens-shaped locus.
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Final Answer:
\[
\boxed{D}
\]
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