My (German) DW has been going through the various procedures prior to citizenship for the past 18 months. She's been here for 40 years, paid taxes, had children, run our own business, worked for charities etc.
First, she had to apply for a Permanent Residence card. This was initially rejected, on grounds including that the bank statements we submitted were for a joint account, as all our accounts are. Also, confirmation from HMRC that she'd been paying NIC since 1978 wasn't considered appropriate evidence. I think they just make things up as they go on.
The second application was accepted and the PR card issued. But, as others have mentioned, there's nothing permanent about it. If you're out of the country for more than 2 years, you lose it.
We then went through the various tests (language, Life in UK) and submitted the application for citizenship. The Home Office promptly lost her biometric data, so we had to provide these again.
Just returned from holiday to find that she's finally been accepted for citizenship. Now has to attend a "ceremony" and not happy about the oath she has to swear, but we've swallowed enough already, so a bit more pride will have to be forfeited.
It's cost us just north of £2500 and many hours of form-filling and (particularly) obtaining supporting documentation (measured in kilos by the end), driving back and forth to regional Nationality Office, nearest Post Office authorised to do biometrics. Plus having to put up with dreadfully rude treatment by some of the (outsourced) agencies we've had to deal with.
Ironically, now she can finally get a British passport, it increases the likelihood that we'll be leaving anyway. It just means that if we find we can't settle in her native country (quite likely after 40 years with no friends or social contacts there), she will at least be entitled to come back here. If we do leave, I'll be a UK citizen in the EU, so pretty much in the same boat as she's been in here.
One DS wants to live in Germany anyway and can get German citizenship by descent through his mother. The other one wants to stay here (good career and completely apolitical), so we'll be divided whatever we decide to do.
My only real worry is health insurance, as we're no spring chickens and I've got previous health issues, so private insurance may be prohibitively high. We've enquired about EHIC cards and whether they'll still apply, but of course no-one knows, so we're still in the dark about whether we'll be able to afford to live abroad.
DS1 will be back in the UK in December, prior to moving to Germany, so we'll decide then whether we move along with him and his wife. That's assuming we can sell our house with only 3 months to go before Brexit day. And that there'll be flights or ferries available.
Our previously calm and unremarkable lives have been turned upside down since the referendum and we'll be living with uncertainty whatever we decide to do. Unlike last time, at least DW will now be able to have a say on her own fate if there's another vote.
I really feel for all those who've posted on here with similar uncertainties. We're sick and tired of the whole thing and there are millions like us, unsure as to what to do for the best. My anger and contempt for those who've unthinkingly or uncaringly caused this are unbounded.