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.
Perfect solution!!! I gotta admit, there were times the queue has popped for me soooo long after I joined, that I'd forgotten I was even in the queue. This system message would also serves as a handy reminder that I'm in it and should be getting a pop soon, allowing me to leave it and continue doing what I'm doing, or wait for it.