Originally Posted by steber
This method is a batch sparge unless I'm reading it wrong??
you are not reading it wrong.
to answer your question, it seems to me like you're interpreting everything correctly.
to answer your other question about wait time, the only wait time i would consider here is the time it takes to stir up your grains and vorlauf (dumping initial runnings back into MLT). so basically, dump your 3.25 gallons of 175 degree water into your MLT, stir it like crazy to free up the sugars, collect about a quart of runnings or until it's clear, and then dump this non-clear wort back into MLT and then drain into kettle.
although it's excellent to have such a precise plan going into brew day like you have here, i've learned that the rule of thumb with sparging is simply to sparge until you've collected the amount of wort you want to boil with. i do a hybrid fly sparge (described here: http://www.homebrewtalk.com/f36/hybrid-fly-sparge-technique-75454/
) that is much less stressful than batch sparging and yields high efficiencies.
for example, i want to make a 5.5 gallon batch, and i know that i boil off about a gallon of water every 60 minutes. because of this, i'm going to want to sparge until i have 6.5 gallons of wort to boil in my kettle.
hopefully that wasn't too confusing. if it was, disregard it. everything you described in your initial post sounds correct to me!
best of luck.