In a bankruptcy, all assets are locked until they sort things out. This means you cannot but or sell until then, whenver that actually is.
That's regarding your positions. Regarding your cash, don't expect the SIPC to "protect" you. If ETRADE is in trouble, who else do you think might be? Do you suppose others like ETRADE have an derivative exposure?
In that scenario, the SIPC can't give you cash, so they give you some kind of illiquid US bond issue, or similiar.
The complexity of derivative exposure is explained here, and in only a few other places:
www.jsmineset.com