Mark
As usual someone posts on this forum and whitholds the most important snippet of information, the fact is, we have all panicked on your behalf, and our replies look like a knee jerk reaction, now you have shown your cards, and we find your wife's permit ends on April 2008.The home office are not looking for Stephy as we only enquired about a general problem filing in the indefinite leave to remain form and we did not give our names and as the work permit does not run out in her passport visa untill April 2008.
The only thing she has a problem right now with, is that you must have conceded to the Public enquiry line that you wife has changed employer, otherwise they would not have advised you not to present an indefinate leave to remain application.
So working within the strict rules for work permits, the work permit till April 2008 is now invalid, (why did your wife do that almost stupendous thing of changing employer)? when a little patience and grit and determination would have secured her permanent residency status forever, had you just remained calm for a few months more.
There would have been no reason for her not to change employers once permanent residency was granted.
If you ask me, its a crying shame for both of you, now you will have to go through the whole process again, and you are at least 2 and a half years now into the future before you can apply again.
I just wish sometimes Mark people like yourself when they come on this forum and post for help, give the full and true position, (I am not repimanding you) but I find it irritating, as it commits us to giving an opinion when we do not have all the facts.
The fact is now that you have told us the true position, its unlikely that Border and Immigration will be looking for your wife, her visa permit whilst invalid, is likely to be no problem until it runs out, then she enters the Tago ng Tago system of being undocumented and hiding and hiding, if thats the route you want, I suspect you dont want that.
Your lucky in one respect, that in our International airports, there is no exit visa, however your wife could be subject to a spot inspection of her passport, so if she left after April 08 it may cause difficulties.
However on the whole, you should get through this with a minor inconvenience, good luck to you both...