DS 160 Form - TVU Sevis - Cap Gap - Was I out of status?

[AmIOutOfStatus]

Hello guys,

I have been trying to figure out if I was really out of status in the past, If 'Yes' how I can answer any questions regarding this. Here is a brief outline of my status:

Dec 15th 2006 - Entered USA on F1 visa

Aug 8th 2009 - Graduated with MS Degree

Sep 1st 2009 - OPT Start Date

Aug 12th 2010 - H1B Reciept Date

Aug 31st 2010 - OPT End Date

Aug 31st 2010 - Transferred sevis to TVU; However transfer did not occur as my H1 process is already in place.

Jan 21st 2011 - Learned that my SEVIS has been terminated as it is in TVU's transfer-in list.

Mar 12th 2011 - Got new I20 from another University.

Mar 30th 2011 - H1B has been withdrawn.

Apr 5th 2011 - Applied for Reinstatement on DSO's recommendation.

May 25th 2011 - Withdrew Reinstatement

May 25th 2011 - Left USA for Mexico.

June 2nd 2011 - Entered USA from Mexico with new I 94.

May 1st 2012 - Got CPT; I have not used CPT in my old Masters.

May 15th 2012 - H1B Reciept Date

Aug 28th 2012 - H1B Approval Notice Date

Oct 1st 2012 - On H1B status; F1 was automatically terminated.

Dec 12th 2012 - Will graduate from my MBA Program.

Dec 17th 2012 - Have visa stamping appointment in Ottawa, Canada.

Q1: Between Aug 31st 2010 to Mar 30th 2011 - I am on Cap - Gap. I had 60 days to leave USA, untill which time I will still be in status. Am I right about this?

Q2: Was I eligible to work during this time? DSO from my old school was confident that I worked illegally untill Jan 2011, It was then I stopped working. However I have discussed the same issue with a lawyer. As per his opinion "Cap-Gap is a grey area with no hard rules, so it could be percieved either way". How can I address any questions in this regard?

Do you see any other issues with my case that might hinder my visa approval chances.

Any input in this regard will be helpful.

Thanks.