Let us take a look at the C option, which would make the sentence read as follows:
Toni Morrison is one of America's outstanding authors famous for her critical essays, her novels, and her frequent appearances on television.
Then the boldfaced part together as an adjective phrase modifies "authors". The sentence then would be saying that Toni Morison is one of those authors, the kind of authors that are famous for her critical essays, her novels, and her frequent appearances on television.
As you can see, this doesn't make much sense, because the adjective phrase that begins with famous/known for should modify one single writer, Toni Morrison, not an entire group. The group identified in the sentence is marked solely by the one characteristic modifier outstanding. And Toni Morrison is a member of these outstanding writers that is famous for her unique qualities (her critical essays, her novels, and her frequent appearances on television).