This is exactly my workflow, and it works well for me. My tracks are laid out as such:
1. Source (Ref track): unprocessed source that is sent to our analog loop via an extra physical output. I can also use the audition/solo button to hear this track through the main DAW outputs.
2. Process (regular track): records the output of our DAW loop. Use Track effects for extra processing. After recording, I copy/paste these effects to the newly-recorded clip, which I then move to…
3. Sequence (regular track): where I sequence the final album.
My final peak limiter is in a Montage Output effect, so I can monitor through it while processing.
I also have a second Ref track called “Compare” that is sent through a third set of DAW outputs to our monitor controller. I’ll use this for songs I use as references as I’m working. As with the “Source” track, I can also use the audition/solo button to hear this through the main DAW outputs.
Per Justin’s advice, I (almost) never use the Master Section for anything.