Custom Movement Type - Hybrid of 671 and 657

Summary:
Due to a business process we are looking for a movement type similar
to a 671, but instead of inventory going to unrestricted stock, it goes
to blocked stock instead.
Detail:
We have a business process where one plant (store) will create a return
STO (RETPO=X) to another plant (warehouse).  This STO utilizes delivery
processing.  Following the creation of the STO, a negative goods receipt
is perform at the original receiving plant (store) using movement type
161.  This stock leaves the store as unrestricted stock type.  When it
arrives at the warehouse, a negative goods issue is performed using a
671 movement types.  This brings the stock back into the original
shipping location as unrestricted stock.
Since the product being returned is defective we would like this product
to be brought back into the warehouse (original shipping location) as
blocked stock.
We have tried using movement type 657 instead of 671, and while it posts
to the desired stock type, the movement does not update the STO with the
negative goods issue, nor does it remove it from stock in-transit.
Question:
This there either, a standard movement type or settings to create a
custom movement type, which will be a hybrid of 671 and 657?  We want
this movement type to remove the stock in-transit and update the STO (as
671), and go into blocked stock (as 657).

there is no such Hybrid movement type.
you cannot really create own movement types, you can only create new movement types by copy of an existing one.
If such combination is not forseen (and no coding in SAP programs) then it is not possible to create such a movement type yourself.
Stock in transit has no stock categories to differentiate between unrestricted, quality or blocked stock, you can only post unrestricted stock into transit. Hence you can only get unrestricted stock from in-transit.
QM would have been an option as you can define inspection types and they trigger that a stock will go into quality inspection instead directly to unrestricted.
But you already said that you do not use QM - so there is not much what you can do except remembering that you do a transfer posting to bring returns into blocked stock .

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