Hi Richard,
Yes in answer to your question, your ATPL's ie. your groundschool exams (just a minor point, but your ATPL is actually the combination on your ATPL's (groundschool exams), your CPL, and your IR. This then gives you your frozen ATPL (fATPL)) do need to be done first before you can proceed to the next stage, the CPL.
I know you would ideally like to do the ATPL's (groundschool) on a full time residential course, however if cost is to be an issue (and it is with many of us), then maybe it may be worth considering D/L to keep the cost down, and keep a wage coming in.
The cost should then reduce to approx. £1900-ish, plus exam fees, but as I say, it does allow you to earn your way through this phase.
When you pass the exams, you then have three years to pass your CPL and IR before your results "expire" so to speak, but I'm afraid yes, the exams do need to be passed before going any further.
Sorry if this is teaching you to suck eggs, but I guess you already have a PPL, the modular groundschools require you to have at least a PPL before you enrol on their courses.
Good luck whichever way you go.