Starting with up/down might work, since it isn't used in bulk movement, and most of the time you need a transformation to extend your vertical reach. The "no neutral position" issue might be reduced if the transformation starts at some half step position according to common center of mass, rather than maximally overlapping or most recently used, so that there's nearly always least one arrow involved in choosing the position; something to try.
Another scheme: You might choose a block (with arrows) and then use the arrow to draw the new shape from there (similar to red zone), eliminating the need to look back to the catalog to pick a number. Seems more natural, but likely too many keystrokes, and going from choosing a starting point to drawing is awkward. (Edit: This would be nice for touchscreens!)