Bacchi,
So, yeah, the guy I talked to today seemed to have a much better understanding of what I was trying to do.
Yes, you can convert the 401k to a traditional IRA and then ladder it out.
However, you have to terminate the 401k in order to convert it to the IRA.
I don't know if that really matters or not, but he did emphasize that there has to be a trigger event in order to do anything with it: reaching 59.5, business goes under, death, or terminating the 401k.