Protecting battery and USB inputs from each other
Is this a sensible circuit?

Only you can decide if it's sensible. I can say what it doesn't do that you think it will do. Such as this: -

When USB 5V is present, the PMOS (Q1) will be turned off regardless of
if the battery is in place and restrict flow to the battery terminals.

This won't happen - when the USB 5 volts is present, the PMOS source-gate voltage is 5 volts (-5 volts \$V_{GS}\$) and this will turn on the PMOS and connect the battery with the USB supply. I don't believe you want this to happen!
What you actually need is for the gate to be connected to USB 5 volts so that the PMOS turns off. You might be able to fiddle that a little like this: -

But don't take my word for it - simulate it and prove it works.
Given that this is a fundamental &quot;insensibility&quot; then I'm not bothering with the other points because you need to prove the modification I've suggested actually works in all scenarios. And then, once you have mastered the art of simulation, you won't need to re-ask this question because, the sim tool will tell you what you need to know.