Oz I completely agree! It's all in the power of the written word (or lack of!), I am sure over a beer we would have sorted this one much sooner! I completely agree that above MSA you can be where you want until the defined point at the end of the outbound leg, but, and this is for the inexperienced posing questions here, it must be within reason. For instance, I had a training partner during my IR training who went over the beacon once in a hold and never got over it again after 3 holds!!!
It is worth bearing in mind that in a procedural appraoch ATC will be separating traffic from position reports by the traffic, so if not where you are saying you are there could be poblems! Also, for an IR test you would fail due to inability to track, even if you were above MSA and safe!
PP