Well, I've answered my own question. I will update this post with my answer. (I hate it when people say they've fixed something and don't post how lol.)
Okay, so I'm not sure if this is the "right" way of doing it, but it works for me 100%.
As an 'every tick' event I added the arms/gun (herein referred to as gun) to be NOT flipped.
I also added the set angle of gun to mouse.X and mouse.Y position here in the every tick event.
In the gun event for checking if it was between 89 and 269 degrees I set the gun to FLIPPED.
Thanks a heap, now it's time for some sleep.
In my infinite wisdom I have forgotten the final capx.
dropbox.com/s/jldjd8mjq3ryqx0/finaltest.capx?dl=0