The SDP needed to be more drilled down geographically to work, and ultimately, it needed to supplant Labour. The Tory vote in the South held up pretty strongly, with London and the Southeast shifting in their direction.
Their path to government I think is in winning most of the Labour North, having Scotland break more for them (perhaps they and the SNP could unite for an election; I'm not sure what their position was vis-a-vis on the Union and Devolution), and winning some marginal seats in the Southwest.
Labour needs a lot more internal shit fighting, with perhaps a Trotskyite breakaway faction forming, a leadership putsch attempt, and a lot of bad blood in general, for the SDP to have a chance at supplanting them.
The scenario you lay out, of no Falklands, could become a real constitutional issue if the SDP alliance wins the popular vote and ends up with less than 100 seats. I think FPTP could be in danger if that was to happen.