Weird, I replied to this yesterday morning and it's disappeared. Never mind, I have an update.
I spoke to her on Wednesday. Not a great success but we may have got sort of somewhere.
Flowery, I gave her your marvellous letter. She was not pleased 
She didn't think I was doing 'flexible working', as I'd never put that in writing calling it that, the whole thing was done verbally. She said it was a 'back to work' plan, which involved me increasing my hours. I said that we never agreed a point at which I would be full time, like we agreed the timescale for 3 then 4 days. She said that didn't matter, I said I never agreed to full time. You can see the circle forming.
So then she said that if I was to put in a written FW request now, I would be offered the 3 days a week contract. And if I was to now refuse to change from 4 days, there isn't a job for me.
It basically comes down to: she wants me in the office everyday. There are small elements of my job that she has continued to do since I've returned from ML, mainly mailing jobs. I can easily absorb this back into my 4 day week. She refuses to accept that this can be done in less than full time (she actually means 5 days). I said we should have agreed a trial basis from the start, so why don't we review the 4-day week in 3 months with me doing all of my old responsibilites. She wouldn't entertain that either. Which is when I worked out that she actually wants to see my face in the office every day.
So I'm working out some new hours, where I do 3 full days and two half days. It will work out cheaper with nursery, as I can swap a short day for a half day, and DH's work hours mean that we can have an extra paid-childcare-free day a week. I'm going to find out if I can work the 3.5% increase into the deal, to cover the extra day travel.
I made it very clear that I'm unhappy with the way this has been handled, and I'm doing this under duress.
It makes me so angry to think about it and even if we were to come to a resolution we were both happy with, I don't want to work for a small family company that has made me feel like this. It's left a bitter taste, and I really think I'd be better off elsewhere. I can't trust her any more. It's sad because I've been with them for many years, but I guess that's how it goes.
Thanks for all your help.