I just developed a holding pattern and placed a fix exactly 4NM and (30 degrees off the inbound course) in the location of where a teardrop entry would take place using the smallest template that TERPS currently uses. In this instance, the 4NM spot (located in the protected side of the pattern) does not exceed the limits of the holding template.
If your equipment allows, it would be perfectly safe to get a dme/gps readout directly from the entry fix.
Likewise, timing also would suffice considering we use very similar (sometimes the same) template sizes based on airspeed as well.
Both methods would keep you in the protected area which is the whole intent of a holding pattern.
If you continue reading that same passage on 5-3-13 of the AIM, it says "Some GPS overlay and early stand alone procedures may have timing specified." So timing MIGHT be used on a GPS hold rather than distance. It just depends.