Feels like the easiest thing to do is hold the lottery amongst the 7 excluded teams, with the rest of the positioning determined by the traditional standings/conference finalists. Maybe they'd use Points % to determine? I also like this because then you don't get another team near the playoff bubble possibly moving to get a Top-3 pick.Hopefully they either just have the lottery be the bottom 7 teams, and draw for the top 3 spots, or the lottery include everyone (maybe except the teams that get a bye in the "first round") and draw for the top 3 spots, but allow no one to move up more than 4 places.
But I could also see them waiting for the play-in rounds to conclude and adding in the eliminated teams. Of course a wrench there is what happens if a 5 seed that was comfortably in a playoff spot loses there and then ends up in the lottery drawing?