A classical expansile lytic lesion in the transverse process of a vertebra is seen in -

The confusion here lies between osteoblastoma and Aneurysmal bone cyst, both of which may involve the transverse process and may be expansile and lytic in nature. However, the aneurysmal bone cyst is purely lytic lesion while osteoblastoma is a mixed lytic and sclerotic lesion. So, the best answer here is an aneurysmal bone cyst.