Thanks for answering and it certainly seems like you've created your own SC structure (no xp, no # of failures vs success, no set DC's, etc.) that works for you. I'm not sure 4e (at least the rules) really added much to your design...I guess maybe initiative??I use milestone xp in 5e and I used it in Pathfinder. I think I started using it in 3.5 or 3e and said level ups would just happen at appropriate times and stopped tracking xp when all the classes were on the same chart.
I had forgotten there was an xp element to skill challenges at all.
I use skill challenges to have a group oriented challenge with mechanics where everybody participates instead of a single character making a single skill roll.
It is to get multiple people engaged in a group activity for multiple rounds with each bringing in their character's specialties and individual approaches and having decision points that impact the action.
Sometimes a single character using a single skill roll is appropriate for a situation. Sometimes I want it to be a whole party thing when appropriate so I go with a skill challenge type of situation.
I did one in my 5e game a bit ago to do an Indiana Jones style street escape when the party was running away from a gang of hobgoblins and ghouls on their figurine of carrion crawling motorcycle with sidecar. One character was driving with decision points of focusing on speed or direction or maneuverings, one was hanging on to a rope while levitating and making decisions and checks on whether to pull himself towards the vehicle or focus on not getting wrapped around lamp poles, one was throwing obstacles at their pursuers, etc.
I remember running a bunch in Pathfinder where the party was trying to do a group ritual to use weird stuff that was around (fey magic nodes, midnight necromancy, etc.) and different party members' ideas and contributions to get something done that was not covered by a specific spell, having a necromancer use an animate dead scroll to bring back a party member as a sentient undead, accessing witch tower stuff to create an effect, etc.
I have no idea if I am doing it by the book for 4e rules, I am mostly going off the concept as advertised by WotC and as makes sense when I am dming. I don't formally have things setup as x successes before y failures, I want everyone to take actions in turn and make decisions in my skill challenges, sometimes with everybody contributing once, sometimes for a couple rounds just as if it was a combat with no attacks, and then I adjudicate based on the situation and choices and some impacts of the die rolls as seems appropriate.
It has been an enhancement to my games when I want to make resolving something more of a group activity.
For me there is a situation... the PC's have a goal and it's very much on them to go about figuring out how to deal with the situation to attain their goal. I don't formalize it with initiative but everyone is involved through the use of group checks and aiding.
Edit: Also in providing back up for characters who fail a check.