If I ever adopt Facebook, this is exactly what I would do. You're doing it right, IMHO.
Edit--my wife has Facebook, only recently (the last couple of years). I tried to tell her not to include people that just asked--now she can't scroll through the site to see what family members and close friends are doing for the garbage political stuff (agree with some, disagree with others) posted, and other stuff (somebody posts every "food recipe" video they see; another posts cute animal videos; another posts the humane society posts and pics of rescue animals, etc.
It's a huge time-suck; she doesn't enjoy going through all of that, and it includes people that "asked" to be "friended" that she otherwise would have no relationship with, and not care.
That's doing it wrong.