Slingsby,
Dont lose face, im fast approaching 2 years now since finishing fatpl and no job. Welcome to the real world. I have a couple of hold pool slots but thats about the best i've mustered. Was offered an air ambulance job at one point but the pay was an absolite pi** take...but thats another story.
Timewsie, approaching xmas is not a good time to be making rash decisions. An FI course at this time(weatherwise) could take months to complete. The FI jobs are also few and far between just now.
I would probably hold out until the spring and see what happens airline wise. Flybe and Ryanair etc have all said they will be recruiting again around March/April so it may be worth waiting til then and get your application away. Fatpl holders will always have a good chance with these big recruiters.
I wouldnt worry too much about the experienced 737 guys who are currently job hunting having been laid off.....many turboprop operators and smaller companies wont touch them with a barge pole. They know fine well these guys will be off elsewhere at the drop off a hat if a better job comes up.
As for the interim, try and get whatever you can - para dropping or perhaps glider towing to keep the flying ticking over. I currently do both..its worth every trip.