What about removing the free whack entirely?
Hear me out.
Move the game just slightly towards a Chess-like system. Let's be honest, this is really "advanced Chess" for the most part, and I'd wager 95%+ of us use miniatures and battlegrids and everything. I don't think that makes the RPG any less "pure," FWIW. Anyway.
What about the following:
2. Movement actions
2.a. Ranged attacks / spell effects, as appropriate
2.b. Melee attacks, if in melee range / spell effects, as appropriate
3. Follow-up movement, IF ALLOWED (e.g., a double-move, sprinting, charge-through, etc)
However, this system would greatly reward clustering your initiative rolls, low-high from rounds 1-2: it would allow the lucky, based on their rolls, to move into melee range after an opponent's initiative, attack, then roll great next round and move away before they could be attacked. Still, I'm not sure this is a bad thing... it's pretty simple, and you can add one slight layer of complexity - the "guard" function a la the old Gold Box SSI AD&D games - to allow the "holding" of a melee attack action, such that if you have somebody move into melee range of you after your initiative, you get to make your attack when they move adjacent. That would balance it a bit, I think.
And just ignore "attacks of opportunity," withdrawal, etc. There's just initiative, movement, and actions.
Hamun Ry (Wiz 4)
Str 10 Agi 15 (+1) Sta 11 Per 11 Int 17 (+2) Luc 10 (Unholy House). Align: C. AC: 14. HP: 13. Melee +1, Ranged +2. Crit: d8, I. Save: Ref +5, Fort +3, Will +4.
Spells: 1: Choking Cloud, Comprehend Languages, Detect Magic (odd crystal growths), Magic Missile (mirror images), Runic Alphabet (Mortal) (ravenously hungry), Ventriloquism (rain of frogs)
2: Detect Invisible, Levitate (extremely difficult, d14), Mirror Image (20% chance to raise/lower luck by 1d3 points).
Equip: Ring of the Sand Djinn: +2 AC/saves, Invisibility for 1min/spellburn point, or unmake for great, unknown effect. Padded Armor, Longsword, Longbow, quiver w/20 steel-tipped arrows, 10 silver-tipped arrows, backpack, spellbook, quill and ink, sturdy parchment (10 sheets), 5 days rations, high leather boots, belt w/ belt pouch, gray robe, dark gray hooded cloak. Also carries 3 small mechanical toys: wind-up mouse, wooden puzzle cube, small jewelry box that plays a little tune.