I have not read the entire Divinity storyline provided inside the novella Child of the Chaos. I have played Divine Divinity, Beyond Divinity, and DKS though.
It would be interesting to let the player decide whether to play as the paladin from Beyond Divinity, the Divine One, the Dragon Knight, or a fourth character. There can be male and female versions for each of them. Each of them will also have the option to kill Damian or settle for several other options.
The storyline and gameplay can be slightly modified for each character from the beginning to the end. The background story for each player character can also bring new players up to speed.
Also, the BD paladin would be like 70 years old by the time of Divinity 3, and unlike the Divine or Dragon Knight, he/she wasn't bestowed with a long lifespan as far as I know. (the 90+ year old Seth and Baud and Deodatus in BD were stretching things enough.)
The story can still be modified to include the BD paladin inside Divinity III. As far as I know, very little is known about what happens to the paladin after he defeats Damian. A lot could have happened which would allow him/her to see Damian again.
Besides, near the end of BD, Damian even says that there will be a reckoning for the paladin sometime in the future. No one knows when, exactly. Thus, it's not outside the realm of possibility for the paladin to show up in Divinity III. The BD paladin can be given a unique backstory in Divinity III as he/she goes through the game.
