Hi Bozeman,
The method you propose in your 08/26/03 post is rather well known I think (among those that discuss the mathematics of deal-making). I believe that Malmuth proposed the same method and something similar was used in
Ziemba's book for horse racing ("Efficiency of Racetrack Betting Markets" (1994) see Harville's article page 213.)
I wish someone would take the time to survey the posts on this subject in the old 2+2 and rec.gambling.poker archives. I know it has been discussed several times.