New H4 EAD rule - H1B to H4

My wife is currently on an H1B visa (her 6 years expires in Sep 2015) and would like to take the benefit of this rule to continue working past Sep (her employer is not filing for her Green Card). I have a approved I-140. Can she apply for H4 visa while she is working on H1B? In other words, can she have both H1B and H4 approved at the same time but continue to work on H1B visa until Sep so that there is no break in employment?

It is never ever possible to have both the states like H4 and H1. If she needs to take the benefit of H4 EAD, you should convert her to H4, and then apply for EAD since you have I140 approved. Regardless it takes about 3 months to get approval for EAD. With so much of rush in May it might get delayed beyond 3 months.