It can and should be assumed that Hyne (asuming Hyne was a real figure and not a mythological device) passed the Witch Embodiment on to Edea, but only in the sense that Hyne was the progenitor of the Embodiment. Edea's powers were explicitly received from Ultimecia, meaning that any Sorceresses preceding Edea were and are irrelevant to her power.Originally Posted by aisle_s
Your main point is correct, as Ultimecia would have certainly inherited the Witch Embodiment from Rinoa; Ultimecia effectively takes on the entirety of the power at the end of the game. This means that even if other Sorceresses did exist during Rinoa's era (something the game does not wholly preclude), all of their power would have eventually "trickled down" to Ultimecia.