I feel that due to the size of the UK and precedent of Switzerland in the past getting concessions on limiting the freedom of movement, (there is also legislation allowing EEA country's to put the brakes on uncontrolled freedom of movement that EU member states do not have) That we could get some sway on the freedom of movement issue.
I don't see the tenants behind the freedom of movement as bad, the freedom to travel, work and reside without the need of a visa. But not allowing countries to control the numbers of people entering should never have been part of the deal.
I think we could do quite nicely by joining the EFTA then sorting some bilateral deal or having EEA membership with some compromises. Just definitely no to schengen, that goes completely against the idea of controlling the borders.