This is a very complex area of immigration law and mainly for the obvious reason that it is open to much abuse by individuals who otherwise not be able to settle in the UK or successfully apply for citizenship. That said the current position is what I can guide you on. The UK will recognise a person as stateless if they are not recognised as a citizen of any country and are unable to live permanently in any other country. Indian citizenship is acquired by descent, and a child born outside India after 1992 is a citizen of India by descent if either of the child's parents was at the time of his birth a citizen of India other than by descent. If, however, the birth was outside India on or after 3 December 2004 (the date of commencement of the Citizenship (Amendment) Act 2003 (India)) the child is not a citizen unless the birth is registered at an Indian consulate 'in such form and in such manner as may be prescribed'. What you will know already is that if the registration is after the child's first birthday it needs 'the permission of the Central Government'. In either case the parents have to declare, also 'in such form and in such manner as may be prescribed', that the child does not hold the passport of any other country. So clearly citizenship is not granted from the date of registration: it is obtained by the birth, provided that the birth is registered.
For the purposes of the statutory provisions in issue in MK judgment that you have correctly identified as the relevant case law, a person is stateless if he has no nationality. Ability to acquire a nationality is irrelevant for these purposes. A child born on or after 3 December 2004, outside India, of parents at least one of whom is an Indian national, and who has not been to India, is not an Indian national unless registration of the birth has taken place in accordance with the provisions of the Citizenship Act 1955 (India) as amended. If the child has no other nationality, the child is stateless for the purposes of paragraph 3 of Schedule 2 to the British Nationality Act 1981 and, if the other requirements of that paragraph are met, is entitled to be registered as a British citizen.
Your child has not been registered with the consulate and is therefore not an Indian national and would be entitled to apply for British Citizenship. She would however need to comply with section 3 of the British nationality act and can apply for registration from when she turns 5. Your dilemma I guess would be with your own status in the uk, hopefully you are able to extend your tier 2 ict visas so that you remain lawfully in the UK. I hope this is useful to you and I would be grateful for your rating at your earliest convenience. All the best