After talking to some knowledgeable friends, I have decided to try letting the girls out on supervised free range expeditions. I hope this cuts down on my feed bill. Even if it doesn't, I bet the chickens will be happier and healthier.
Let me tell you, they love it! At first they just milled about the coop entrance, but as soon as the first adventurous hen decided to to try out her wings, they were all over the yard in minutes. When it was time to go up for the night 14 of 16 went straight to the coop and put themselves up. We only had to corral 2 of them. They probably would have figured it out eventually.
I am a little worried about the dog chasing them and some of them flying over the 4 foot fence. I had the puppy on the tie out for this trial run. They came right up to him and he just looked at them. But, when they run from him, his instincts to herd take over and he chases. It may be a while before I trust him around them off the tie out.
Our whole back yard is fenced with two large oaks and a few evergreens to give them shade and hiding spots. My other concern is hawks. I will only let them out when I can be in the back yard to watch over them. Supposedly the peahen is a good guardian. If she see hawks she will fluff up her feathers and dance around to ward them away. I have not witnessed this behavior yet, lets hope it is true.