None really fits. I would use "reject". The most correct of your four options is probably "confound", but the only one which sounds good is "refute", which means something a little different to what you want.
I utterly refute your argument, as follows.
This means "I show your argument to be completely false, and this is how." It should be followed by reasons, though. "I utterly refute your argument" means "I prove it is false", but "in my opinion, you have distorted the facts" is not a proof.
This would be fine, though, if after this sentence came a proof that the argument was incorrect.
* I utterly decline your argument.
This isn't correct: I can "decline to accept" an argument, but I can't just "decline" it.
* I utterly dispute your argument.
I can dispute an argument, but I can't "utterly" dispute it. It would be like saying "I utterly eat this apple".
I utterly confound your argument.
"Confound" is here used as meaning 1.2 in the Oxford English. It's a weird usage, and I (as a native English speaker) would be taken a little aback by it. However, I think it's just about correct.