I'm conflicted. I once spent 200 days in prison as a conscientous objector. As far as prisons go, it was about as humane as it gets. It was a so-called "open facility" in a Nordic country. We had rooms with doors that were locked st night. We worked making traffic signs in the daytime, for which we were paid a little, and the work was, in principle, voluntary. We could leave the prison compound for an hour each day for a jog or walk in the woods. It would have been easy to just not come back. It would also have been stupid. No-one ran away in the time I was there.

For all that it was barely even a prison, I resented it, and still do. Taking a person's freedom is wrong. It may be necessary for society to function, but it is still wrong. At best it's the lesser evil. And even if there was no prison, no walls, I know I would resent being told what to do in the way your system seems to require.

That said, what you're proposing still seems like it would be less bad than prison, especially prisons as I understand they are in the USA. Of the inmates I knew, practically all were addicts of some description. One young man could not grasp the idea that 110 millimeters is 11 centimeters when I tried to show him with a ruler. I don't imagine them being in prison helped very many of them, or society, in any meaningful way. The one person I felt might not return had apparently quit crime well before but been convicted of some old misdeeds when someone ratted him out.

So it sounds like your ideas are better, at least. Still, I can't say much more than that I think you're entering an enterprise that does evil in the name of the greater good. It probably needs doing, and it sounds like you're trying to reduce harm. I can't applaud you, but I hope you can accomplish your goals and live with yourselves, given the world you're entering.