the_redbeard
Explorer
I think you're introducing more formality and structure than the rules actually need. There's really only one level of hidden, and that's "not being seen." If you've successfully hidden, you can't be seen and enemies have to try to target what they cannot see. They might have a pretty good idea what square you're in based on the particular terrain, but they can't see you. You could be anywhere within that 25-square-foot area, or you might have slipped off elsewhere. Thus, they have to target you by guessing.
What you call "greater hidden" is really just maintaining stealth for long enough that the enemy can't predict where you are, and/or choosing a hiding place that provides a large area of uncertainty. If the only cover in a featureless room is a 5-foot square pillar and you hide, the enemy is going to be pretty confident that you're one or two squares behind that pillar. If, on the other hand, you dash into a 5-square by 5-square cloud of fog, you could be anywhere in that cloud.
Your ruling is consistent with the official FAQ.