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Flexible interconnection transformation of a distribution network using all-control power electronics technology will help to overcome the technical bottleneck of distributed generation (DG) penetration and high-quality power supply in the traditional distribution network. However, the flexible interconnection form that uses back-to-back power electronic converters to replace tie switches has disadvantages such as high cost and large footprint, so its mass promotion and application are bound to be limited. Therefore, a new topology of flexible interconnected distribution network with embedded DC system (FDN+EDC) with a better economy is proposed. Firstly, the topology of FDN+EDC is introduced to improve the controllability level of the distribution network under high percentage DG penetration, and is compared with the conventional flexible interconnection method. Secondly, in order to realize the coordinated optimal economic operation of source, network and load in the FDN+EDC, a dynamic reconfiguration model of switches status and continuous adjustment of flexible interconnection device (FID) are proposed. Then, to achieve a fast and globally optimal solution of the model, a hierarchical coordinated optimization strategy is designed based on an improved particle swarm algorithm for the optimization of discrete and continuous variables. Finally, the validity of the algorithm is verified, and an 88-node FDN+EDC is constructed to verify the advantages of the proposed embedded DC flexible interconnection topology and realize the joint optimal dispatch of network-source-load. [ABSTRACT FROM AUTHOR]