It is a confusing situation. With regard to the UK route, it's rather like the situation of
Miss Toonbarmy; I think that thread is worth reading.
The obvious method would be to apply for SET(F); your husband seems to satisfy the sole responsibility criterion. However, there is one fatal deficiency - your daughter does not have leave to remain. Unlike FLR(M), SET(F) requires that
leave to remain be held.
The obvious alternative is for her to apply for settlement from abroad. The problem with that is whether she would have to be living abroad, and whether she could return to the UK while she waited for her application to be decided. A method was suggested on the ToonBarmy thread.
I forgot to ask what your stepdaughter's nationality was. If she were an EEA national, you could make her 'self-sufficient' by buying her CSI, and that would solve your problem.
A complicating factor is that it is by no means certain that your stepdaughter is lawfully resident in the UK.
EEA Regulations, Regulation 9(4)(a) wrote:(4) This regulation [= the Surinder Singh regulation - RW.]does not apply—
(a)where the purpose of the residence in the EEA State was as a means for circumventing any immigration laws applying to non-EEA nationals to which F would otherwise be subject (such as any applicable requirement under the 1971 Act to have leave to enter or remain in the United Kingdom); or
This rule came into force on 25 November 2016. Many, including myself, believe it is contrary to EU law.
There may be a way for her to automatically gain leave to enter the UK if she does not have an enforeceable EU right to reside in the UK:
(i) If she is Indian or Chinese, she might be able to obtain an Irish visa for 90 days or less endorsed 'BIVS'. If she then entered the UK from the Republic after activating the visa, it would automatically confer leave to enter the UK.
(ii) If she is not a visa national, then she would automatically get leave to remain in the UK for 3 months on crossing from the Republic to the UK.
All this is courtesy of the
Immigration (Control of Entry through Republic of Ireland) Order 1972; the special rules for Indians and Chinese come from an amendment in 2014.
Whether one should try to argue that she does not have en enforceable EU right to enter the UK because you deliberately arranged your affairs to avail yourselves of SS is another matter. If you won that argument, there would be a 5 year delay before she could become British. The best time to apply the automatic leave to remain would be as the SS-derived rights were lost.
