Immigration Problem, Huge Mess!!! Please Help!?

Ok so here’s my situation. I lost my Conditional Residency Card in January and was due to fly out of the country for home in April. My lost card expired in July which gave me six months. We were going to hold off to do the I-175 but my aunt, who was quickly passing from Cancer was slipping fast. So I travelled to my USCIS and explained my situation, I had to leave because I had a major family emergency. They advised me to re apply for my I-90. When I asked why the explained that since my I-90 didn’t expire for seven months I should get my card replaced and it would be in on time for me leaving the country and subsequently make it easier for me when I applied for my I-175 upon my return because I couldn’t apply for my I-75 until April.
I relayed this to my lawyer who agreed it was the best course of action so I paid, re-sent my I-90 and left the country. My card never came by April so I went to my USCIS and they happily stamped my passport for a month outside of the country on the basis that I had re-applied. Everything was Rosy, I got to spend a small amount of time with my aunt and attend her funeral upon her passing.
When I returned in May I heard nothing from the USCIS. I called them almost daily and was told that my card was still in processing and it would take up to six months to get anything back. In august (A month after my card expired) I got a letter in the mail saying I was scheduled that week for my biometric appointment. When I went to get my fingerprints and everything done I asked if my expired card would be a problem to the process and there exact response was ‘No, you will just default to the ten year residency, there won’t be any problems.’
I was confused to say the least. So I returned to my lawyer, who assured me it was all fine and would be no problem that my card would be in the mail in the next few weeks and to just hang on. In that time my current place of employment started getting nervous about me being out of status, so I signed a release for my lawyer to explain EVERYTHING to them and my situation because…it’s complicated, right?
Then we called USCIS and they told us if we didn’t hear anything by September 30th to go and appeal and I would get my card soon after. We relayed this info to my place of employment and they seemed…Not happy, but content with the explanation.
Now it’s October third and I received a letter today saying my application was denied and that I am considered ‘Out of status’ because my card expired in the time it took to process my new application. (The letter arrived Sep 28th but my lawyer was out of town dealing with other clients at the time) My question is what are my options now? My lawyer recommended going ahead with the I-175 and seeing if that gets approved but I don’t have the time to wait or have a chance I will be denied again. I’m going to lose my job, my apartment and perhaps get sent home with me and my wife’s first child on the way (Talk about a sob story right?).
I can go to Washington and appeal but that will cost an awful lot and its set up for failure since I am, by all means and definitions, out of status. I cannot start the process over because of some crappy mistake that I don’t feel I made. The only thing I have to my name is a passport and my social security card which are the only in date I.D’s. My American ID expired two months ago and they refused to give me another without my residency card. I guess you could say I am in poop creek without a paddle in sight. I desperately want to get out of it but I need help. My lawyers even confused by the rejection.
Oh and when I called the guy who handled my case and attempted to explain what had happened he told me that “His opinion differed with whoever gave me the advice in the first place” and that’s all he needed to say. He also said I had 30 days to respond.
So if this makes sense to any immigration lawyers or someone who has been in a similar situation, boy could I ever use the help. I have lived her almost 4 years, worked for every day I legally could and feel I have been dealt a very bad hand at a supremely bad time in my life. I’m not trying to deceive anyone, I have done everything right (Or what I thought was right) but this process is far bigger than me and my wife.
I know this is a lot to digest and I apologize for length, if by some miracle you need additional info please ask, I will be watching this thread closely. Thanks to anyone in advance!
By the way I am from the UK if that helps with anything. Me and my wife have been married 3 years I have been working almost three. I have lived here legally for four.