I think that sounds like a good idea, hope it works out for you!
Personally, the way I do it is that I use a wooden wedge first, and then add a circular metal wedge afterwards. I've tried to explain it in the pictures below. Don't know if you use these kinds of wedges or what they are called in English.. They work much in the same way as your wooden wedge in that they expand the handle out in all directions. So far this has worked out great for me, but then again I haven't worked as a blacksmith for more than 5 years.
In my experience, another important thing about hammer handles is that the grain of the wood in the handle should be in the same direction as the working action of the hammer. This way, the handle flexes in the same direction as the hammer moves when it hits, and makes the hammer less likely to "bounce around" when you are forging. The handle also becomes more resistant to breaking this way.
Just my two cents. Any remarks or other opinions are greatly appreciated!