It turns out that this is much more efficient, if you’re willing to spend the time to farm.
0.2 Heroes/Flag (best available)
50/50 mix of 1* and 2*, for an average of 324/hero
Which gives 64.8 hxp/flag
Even at the base value of 15 WE, this yields: 9.72 hxp/gem, so it’s about 3x as efficient
It also has the knock-on effect of getting ascension material drops, which will be necessary before long (and increases the efficiency, because one can use those backpacks and swords to generate extra feeder heroes).