Can MN1 3(5) be applied for while abroad?

Hello. A bit of an unusual situation here!

I am a British citizen by descent who has been living in the UK with my husband (non-EU) and two children (born abroad) for the past three + years. I am in the process of applying for citizenship for my children under MN1 section 3(5), but it looks like we might have to leave the UK indefinitely just after applying (and probably prior to biometrics).

My questions are:

1) do we still need to be living in the UK when the application is approved?
2) if no, can we apply here and then do biometrics when we arrive abroad?
3) if we state on the form that we intend to live in a country other than the UK if they are granted citizenship, is this grounds for refusal?

We are having to leave the UK sooner than expected due to covid and ill family members, but don't want to miss out on citizenship given the kids qualify by living here for three years, and we don't know if we will come back again at some point prior to them turning 18.

Thank you for your help!

Just to add, the children are here on FLR(M) until 2023, so presumably we could also return at some point (as long as we don't exceed 270 days) to complete citizenship?