I think people where still very un-certain about Kinnock (alot more than people are now about Cameron), and you could have a hung parliament,
Oh, I'm sure Labour would have won, and reasonably comfortably. (Not over a hundred or anywhere near, but certainly decisively.) Thatcher was desperately unpopular at this point. Desperately. Please remember, she would be going into this hypothetical election with a commitment to retaining the Poll Tax. (Unless, in her weakness, someone can force her to abandon it - good luck)
Agree in respect of the inevitability of her doom by '89/'90. Even if she had won, it would have been a technical victory. She'd have either been challeneged again the following year, 'pressured' out by the Cabinet (unlikely but possible if a head of steam builds up) or (probably the more palatable option for her) clung on for dear life until the end of Iraq to take the party down to electoral defeat with her, if neccessary.
In the short term, it would have been a disaster for the Tories, but in the long-term, I suspect it would be to their benefit.