the best workflow is to interpret the 29.97 footage into 23.976 and then once you put that into composition, either use twixtor or timewarp (AE) and render according to the speed and put it back to 125%. I normally don't use nearest interpolation as it tends to cause artifacts especially when the footage is already cut. I either use whole frames or frame blend, although it might not look as good as the nearest interpolation, adding some motion blur (either 2.0 in twixtor or 180 degree shutter in timewarp) gives it a better cinematic feel to the image
that setting seems like a great idea, i dont know how i missed it on cinema5d
i did try something similar to what you suggested, but i'll have to try your method