Canon 5D Workflow documentary: h.264 -> hdv to edit in

Hello!

I am about to begin editing my first feature-length documentary in FCP, and am concerned that I'm going to make crucial mistakes in setting up our workflow because I'm so inexperienced. If you guys can have a look at my proposed workflow, and throw out any advice, that would be immensely helpful.

This is a low-budget film shot on a Canon 5D. We currently have about 40 hours of footage, I'd estimate 1/3 of it is usable. More footage will be shot and added to what we have, we'll be shooting and editing simutaineously. I have been given harddrives of footage, in it's native H.264. I know that it's most often recommended to transcode this footage directly to Apple Pro Res, but that is impractical for us both space and time-wise (did I mention low budget?)

Instead, it was suggested that we transcode the footage into Apple HDV (mpeg2), which cuts the file size almost in half and edit in that. Once the project is complete, we'd relink it back to H.264, and then transcode that final piece to Apple Pro Res. Our goal is to submit this to festivals.

Is this the best route to go?