That sounds like a good solution. Especially now with the convenience of QuickGroups to remove a member whose citation(s) have been fixed although I think the long-wished-for Group Refresh (against your stored rule) would be more reliable because there could be multiple sources for a person needing the 'Fix'.
Because your objective is conversion of Free Form sources, I would think it desirable to tackle it through the Master Source List rather than person-by-person, although the latter may be the way to go to prioritize those sources that are used for the people in whom you are primarily interested. If you color-code the latter, then they will stand out in your 'Fix' group.
That said, you have a big challenge ahead and I wonder if you should not review your goals and why you have chosen the route of converting your sources in this manner. Have you considered the disadvantages of storing your citations in templated form? Have you considered the pros and cons of lumping vs splitting? There has been much prior discussion in these Forums and a wide range of approaches.