Well this is a little more sophisticated than the "hold the queue til the warzone ends" concept, and I think I like it.
One tweak: Dan should move up in the queue if he is in a warzone and a queue pops for someone else. Otherwise, it still gives incentive to not join warzones and sit idle.
Once Dan gets to #2, if he is still in his warzone and the queue pops, #1 and #3 should get the invite. When Dan gets out of his warzone, he should get a message on his PvP interface that he is next in line in the LFG.
I like the tweak. I haven't run pvp much, but I'm guessing from what you're saying that the pvp queues pop very very quickly, not leaving much time for a person to move through the lfg queue. If that's so, then your suggestion makes a lot of sense.