Forgive me if I'm telling you things you already know, but I'll mention it for others, if not for you.

Erosion is caused by two things - volume and speed.Anything you can do to reduce either one reduces erosion. The lawn is good because it has a lot of blades that the water has to go around which slows it down and also allows the soil to absorb some (both reducing speed and volume). Also, slope translates to speed. Longer slopes translate into increasing speed.

Anything you can do to disperse water rather than concentrating it is reducing volume. Sometimes we combine drainage so that we deal with it in fewer places. But sometimes it is not a good idea because you create a big problem instead of several smaller and easier to deal with problems.

Since you mentioned that the path is a convenient way to divert water, it makes me think that it is intercepting water that might be moving across the lawn and concentrating it (making a bigger volume) more or less in a channel that is the path. If it goes downhill on a steady slope, water will build up speed and erode. Interupting the slope with a step every once in a while will flatten the grades between the steps, thus slowing down the water. If the path has a cross slope, the step can divert the water off of the path at that point removing it from joining up with the water that the path is accepting between that and the next step. You may have seen this technique on hiking trails just using logs.

Even if the water has to pass over the step, it will be reaching the edge of the step with very little speed. although dropping over the edged of a step will add speed to the water, it has ery little time to accelerate and lands on another slow slope. It never builds momentum.

Another good technique is to privide better drainage closer to the source. It seems that you hinted that the driveway may be the biggest source of runoff. I will assume that the water is not channeled in a paved swale that concentrates it, but rather drifts off onto the lawn all along its path. In that case, a narrow deep trench filled with larger stone can hold some volume and provide side and bottom area for the soil to absorb some of it. I would not continue such a trench where the driveway slopes a lot as water would rush along the trench.

A retention swale that holds volume and traps it untill the soil absorbs it is an option, but most people don't like to have a puddle or wet area. Some have the space for it and don't mind.

Another thing is a detention swale that captures the volume and holds it temporarily by having it drain out in a limited manner such as making the swale drain out of a small pipe that can only handle so much water. It detains the water only to let it go on its way in a controlled release.

Compaction of your stone in the path is not really much of a problem for water erosion. Smaller surface stone will wash with less force than larger surface stone. Stone in swales is often refered to as "energy dissipation" material where it takes the force of fast concentrated water coming off of a pavement or from a pipe. It takes the impact and slows the water down in the initial portion of the swale. The slope of the swale will then take over in managing the speed of the water and the stone is no longer necessary.

Hopefully, this will give you some insight to help you analyze what is happening on your site and some different ideas on what might be options for your specific situations.

laag, your post gave me some terrific ideas for my swimming pool runoff area. I have been working to "naturalize" it with stones along the edges and plantings that arch over it to kind of hide it, but also to try to dissipate the water so that it doesn't reach the end with such force and so some is diverted along the edges. Only, I was not employing any systematic means of doing that. Also, some time ago I determined that I can't make a typical "dry creek bed" by filling it with stones, because there is so much leaf litter from overhead trees that I still need to clean that out--sort of like a house gutter--and any size of stone filler makes that a nightmare. (If you look at photos of man-made dry creek beds, you will notice that they are most often in an arid place, or open lawn or garden, and less often surrounded by oaks, pines, and maples!) So I was trying to retain the "smoothness" of the interior to clean out debris once or twice a year with a small rake (this material is great for mulch or the compost bin).

Now I see that I can try to attack it in a sectional way and try to think about the principles and trade-offs of concentrating flow vs. reducing momentum while still being able to do "maintenance". For example, right at the beginning of the runoff, the area in complete shade (so is less weed-and grass-friendly) and is completely hidden from the street, and may even lend itself to making a small dammed area over a wider area to slow the flow right at the beginning. Then, instead of letting it just follow the slope of property down to the street, which it does now and gathers momentum, I never thought of creating elevations within it (like up-ramps) perhaps using short sections of "log", or intermittent single large stones set sloping backward.

Laag - your assumptions are correct. The paved driveway collects water and directs it to a low spot which pushed the water onto the grass, which has a slope right towards the pathway. The grass area is narrow, and does not really suit a swale.

I was not thinking so much of steps in the path. I was hoping to keep the slope, but add the wood to stop the gravel from washing away. Admittedly, after a while this might result is slight steps.

I have three other low areas along other sections of the path. in one area I made a large french drain using plastic pails and rock. In two other area I added an underground drain pipe. All three of these solutions are working quite well.