You'll get the most conditioning benefits from variety. If you were going to use the treadmill four times a week, I'd suggest this:
Day one: A one hour walk at 4 (it sounds like your pace settings are on a similar scale to the one I use -- somewhere between 4 and 4.5 you have to stop walking and jog, right?), with the incline up to maybe 4 or 5. Just a consistent, uphill walk. No deviations, no rest. By doing this, you're building your cardio base and getting used to staying in motion for longer than you normally do when you run.
Day Two: Do a five minute jog at an easy pace to warm up. Now, only put the incline up at maybe 2, and do sprints. The pace is up to you, but it should be the fastest you're able to run (mine are up around 9.5 right now, which I think is about a 6.5 minute mile). Do a 20-30 second sprint and hit pause. Let yourself rest for half the time you sprinted, and start it up again. It'll take maybe 5-10 seconds for it to get back up to full speed, and then start timing your sprint from there. 20-30 seconds again (try to stay consistent with your first one), and pause. Same rest period. You should try to do six of these sprints, and if you have anything left, do two more and that's it. Do an easy five minute cooldown, and that's your cardio for the day. By doing these sprints, you're conditioning your body to run a lot faster, and it'll remember this in your normal distance runs. I've shaved ten minutes off my 3 mile time by mixing sprints into my training.
(I'd recommend taking the next day off from running, because if you're new to sprints, you're probably a little sore.)
Day Three: No full sprints, but do a 30 minute run at varying paces and intensities. Something like you described, only take it down for one minute walks at a few points. Switch up the incline, switch up the pace, from running at a pretty good clip, to a slower jog, to running again, to walking, to the jog, to running, etc.
Day four: This is for distance, and it's the payoff for the other kind of training. Set the pace at what you think you can comfortably handle, and cover three miles. The time isn't important, so shoot for maybe a pace of 6.5. The idea is to cover the distance and finish feeling strong. If that means doing it at a pace barely above a walk, that's okay. By doing the other sessions, you'll find that your speed and conditioning will improve quickly, and in a couple of weeks your three mile time will improve. Eventually, as three miles gets easy, you can increase the distance to four, and onwards and upwards as you improve.
Stick with this and you'll be running a half-marathon next year and there won't be an ounce of fat on you (well, that would have to include changes in your diet, but this is half the battle).
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