Given data for 100 observations

$\sum x = 400, \qquad \sum x^2 = 2475, \qquad n=100$

Incorrect observations to be omitted

The incorrect observations are $3,4,5$.

Their sum is: $3+4+5=12$

Their squares sum is: $3^2+4^2+5^2 = 9+16+25=50$

Corrected totals after omitting these 3 observations

Remaining number of observations: $n'=100-3=97$

Corrected sum: $\sum x' = 400-12=388$

Corrected sum of squares: $\sum {x'}^2 = 2475-50=2425$

Formula for variance

Variance of the remaining observations is $\sigma^2 = \frac{\sum {x'}^2}{n'} - \left(\frac{\sum x'}{n'}\right)^2$

Substitute the values: $\sigma^2 = \frac{2425}{97} - \left(\frac{388}{97}\right)^2$

Simplify

First, $\frac{2425}{97}=25$ since $97\times 25=2425$.

Also, $\frac{388}{97}=4$ since $97\times 4=388$.

Therefore, $\sigma^2 = 25 - 4^2 = 25-16=9$

Final answer

$\boxed{9}$

Hence, the correct option is D.