I remember that you were filing 7th year H-1 extension. Such an extension needs to be filed timely before the previous H-1 is expired. The chance is not good if you file the 7-th year H-1B extension again right now or any time after your previous H-1 was expired. In this situation, you have to stay one year outside the US to qualify another fresh H1. While I am not sure what your lawyer's first opinion really means, I think what he/she is doing is to avoid the above situation. He/she want at first to file a H-1 extension to recapture the lost H-1B time withing the 6 year H1 framework. Then file an extension to seek the 7th year extension. If your hu*****and spent big chuck (>= 1month) time outside the US during the H1 period, the strategy may work. Contact your lawyer to make sure what he/she means.
In addition, your clock of three year bar starts right after the exension was denied instead of the expiry date of the previous H1B.
I am glad to tell you what I know and wish you good luck.