I did that quest, too, and I think the only options may be to use a canned Sim or create a new monarch. I did not find any way to move another hero into the monarch role. Since children don't age up in this game, it's doubtful that your monarch's child would be able to succeed their parent. Fortunately I chose that quest early on, before my monarch was at a high level, so it wasn't too painful to start with a new level 1 hero. If I had invested more time in her, I would have been really ticked off at losing her.