The downsweep allows the greatest free distance as the receiving athlete has his arm fully extended behind him (in the push pass. the arm comes behind and to the side). The incoming athlete can extend his arm fully, which is the same as the push pass. I think the push pass is the best technique to use.
Your method will not quite maximise the ability of your relay, as the third leg runner will not be anywhere near top speed when he/she receives the baton. You would be better off having the 3rd leg runner start at the start of the fly zone, but make her start running earlier. She/he still gets the baton in the same place, and so still only runs the shorter distance, but the baton speed will actually be higher. Hope this makes sense?