I think even the moderate raise to $700 would give people on the flush draw incentive to stay in. However, this being the case, you raising to $700 would then trap the flush draw in, and the person in front of you would (in theory) raise all in, you would call, and the flush draw would invariably drop, as his mythical pot odds would no longer be present.
Raising less is meaningless -- raising more chases him out before donating another $700.
Barron Vangor Toth
www.BarronVangorToth.com