What to do? SET (LR) or SET (O) or nothing?

Dear members

Hope everyone is well. I need advice regarding my messed immigration situation. The history is given below:

On October 5th, 2007, I came here to study MSc in an University. I have finished my Masters on July, 2009. I could not apply for PSW as I had to return to home due to my illness. No one is here to look after me and I had Hepatitis B, so doctors send me home for my own safety. I went home on end of October, 2009. I recover from Hepatitis B on End of February and apply for PSW from Dhaka, Bangladesh. I have issued a PSW visa on March. I was about to come here on first week of april, 2010 but ash cloud strike from volcanic eruption. All the airports in europe and UK were closed for months. I arrived UK on 5 of May, 2010.

I got married On January, 2011 in Bangladesh and Wife arrive here as PBS Dependant on May, 2011.

On April, 2012 I apply for Tier 4 (Student) visa and got the visa till December, 2014. My wife get Tier 4 Dependant visa too. We were blessed with baby daughter on October 2014, in UK. On december, 2014 when our visa was running out, our solicitor advice us to apply for FLR (O). One of the company was interested to hire me and sort out Tier 2 work permit (Company did not have the license, they apply for it and waiting to get the license). My solicitor made the ground that I need some time for switching to Tier 2 visa. Solicitor did not attach my daughter in to the application as she is too little (3 months), had no valid passport.

Our FLR (O) get refused on May, 2015 with no in country right of appeal. They served us with IS 96,(they certify the refusal as there is no merit) so we had to start signing in to local police station. In the mean time our flat roof collapsed and whole flat destroyed on May, 2015. I have got a Police caution on december, 2015 regarding insurance matter.

When my FLR (O) visa get refused with no in country right of appeal, my solicitor advice me to appeal to first tier tribunal to get right of appeal. First tier tribunal has accepted it and give us a date for hearing. On May, 2016, we went to Birmingham and the judge gave us the in country right of appeal and on that day she took the hearing as well. On August, 2016 the Judge gave us a letter saying she made a mistake as it was certified so there is no right of to take the hearing. They have also send a form for asking permission for Second tier tribunal. We have asked for permission to Second tier tribunal and the Judge stick to the decision with First tier tribunal.

On March, 2017, after the decision from second tier tribunal, I have applied for FLR (HRO) including my baby and more evidence that we have death threat back home and my parents flee to neighbour country. There are killing and vandalism going on to minority in our country. We are minority in our country. Done the biometric on August, 2017 for FLR (HRO). As I had to carry on till December, 2017 for ILR (Police caution 2 years cooling off period), we have made a variation of our FLR (HRO) to FLR (M) on September, 2017. November, 2017 Home office ask for extra money to adjust for the variation. We have provided the fund and Waiting for the decision.

Though I am over 10 years now, but for the caution I can apply for SET (LR) on December, 2017. My solicitor is asking me to go for SET (O) rather than SET (LR). SET (O) guidance advice that, if there is previous Human right case, then you cannot use SET (O). My right of work finished on August, 2017 (Reason: New application submitted). My daughter is 3 Years old now, going to pre school. Can you please advice me what to do now?

Apply for SET (LR) as there might be chance for right of appeal?
Can case worker will be very kind to give me discretion for all these problem (Gap, Caution, no right of appeal)?