Quick update for anyone else who may be in this position....
I spoke with Immi today. The 90 period is from THE DATE YOU CEASE WORKING with your sponsoring employer, not from the date you receive the notification letter from Immi as it suggests on a couple of other forums. After the 90 days are up, you will receive a notice of cancellation of the visa.
If I submit the 820 application and my 457 visa expires naturally (ie after the full 4 years, cancellation or the end of the 90 day notice period does not count as "expiring naturally") then I would go onto a Bridging visa A, which allows work rights and allows me to then apply for Bridging visa B which gives travel rights. However, my 457 visa expires in 2018 so this can happen.
There is a 12-15 month processing time on the 820/801 visa. This means, even if I submit the 820 application prior to the end of the 90 day period, it wont be processed before the 90 day period has finished. This will result in me breaching the 457 visa conditions stipulating I must have another sponsor, visa or have left Aus prior to the end of the 90 days. This would result in me automatically being transitioned onto a Bridging visa E (BvE)- the worst type of bridging visa which does not allow for travel and has no work rights. Technically, this also means that I would be on this BvE with no work rights for the next two years!!!! (However, Im pretty sure there are ways to transition onto a better Bridging visa with work rights if you are in this situation). This is also not a valid solution for me as I HAVE to travel to the UK in the coming weeks.
Another option that was suggested is that I could let my 457 expire and travel back to the UK. Whilst in the UK I could then apply for the offshore partner visa, and then apply for a visitor visa to re-enter Australia, explaining the situation with the partner visa application, and then at least be back in Aus whilst the partner visa is processed. Another downside to this solution is that the visitor visa would also have no work rights, and given the processing time again is 12-15 months, this would be a long time with no income!
I have a meeting with a immigration consultant tomorrow to discuss further options, but if anyone has any further comments/suggestions in the mean time, Id love to hear them!!