Yes, get rid of the rail fence. Too dark, and yes, vaguely swastika-ish... I'm always amazed at how many blocks have this slight illusion.
I vote for a small sashing between the blocks. I think it would look good with the negative space to have the brown border.
Personally, I'd do meandering or straight... but that's because they're fast and I can do them! So I'm a bit biased on that one.
Looks great! Good luck!