"Session propogation is occuring by imbedding the SID in the URL"
A bad move, but it's your choice.
"I would like to use the referer_check option as it provides the most bang for the least effort."
It is also completely unreliable because not all browsers send it by default, and it can be disabled. Also, spoofing the referer is easy as 1 2 3. Spoofing your IP is a lot more difficult.
"Additionally, while not as secure, it doesn't have any problems with visitors who are coming to the site via clustered proxy/firewalls which could cause them to have multiple IP addresses within a single session."
Most proxies (except anonomizers) send the true IP of the request along, because that is the only safe way of recognizing a client.