In that case yes you can work during your cap gap extension, as long as you filed h1 before your opt gets expired. There used to be PDF document in sevis site which explains how cap gap extension is granted. I had referred in 2008/9 , you should be able to google it. Actually you will get full extension only after you get h1 approval . Redarding work permit you can work with expired opt card and new I-20 which your school will issue you for cap gap extension.