When congressional investigators issue their final report on the Iran-contra affair this week, there will be one curious corner of high-rent Washington that won't be able to read a word of it.

It is the office of independent counsel Lawrence E. Walsh, who for the past 11 months has been conducting a criminal inquiry into the Reagan administration's worst scandal.

Walsh's office operates in constant apprehension of learning the right facts in the wrong places, of being "tainted" by the congressional testimony of its principal suspects.

Fired National Security Council staff aide Oliver L. North, former national security adviser John M. Poindexter and other key Iran-contra figures agreed to testify at the nationally televised Iran-contra hearings last summer only after receiving court orders granting them immunity from criminal prosecution for anything they told Congress. This means that Walsh & Co. must find their evidence elsewhere.

This prohibition puts Tuesday's House-Senate report off-limits. Although not all the congressional testimony was immunized, a Walsh spokesman said, "I don't see how we can sort out what's tainted from what's not. It's going to be like an omelet."

While the precise prosecution strategy is still evolving, sources said it is no longer a question of whether Walsh will seek criminal indictments, but when. He has been presenting evidence two or three times a week ever since the Iran-contra grand jury was sworn in last Jan. 28.

Aides in Walsh's operation took other steps months ago to isolate themselves. While millions of Americans watched the dramatic testimony of Marine Lt. Col. North and Rear Adm. Poindexter on television, Walsh aides canceled their newspaper subscriptions, stopped watching television and asked their spouses not to discuss the hearings.

"Everybody had to stick their heads in the sand, not go to bars and things like that," said John W. Keker, a top aide.

Monasticism aside, Walsh is convinced, knowledgeable sources said, that his investigators have produced enough of their own evidence of criminal wrongdoing by key figures in the Iran-contra affair. Sources said Walsh is putting together a broad conspiracy case that may include such specific charges as misuse of government funds and obstruction of justice.

Indictments could be sought in January, sources said, if no major surprises are contained in the crucial Iran-contra Swiss bank records Walsh recently obtained. If the Swiss records offer new revelations about the complex network of dummy corporations and overseas bank accounts set up for the covert Iran-contra initiatives, the sources said, it could be spring before Walsh makes his move.

When he does, Walsh's principal targets are expected to be North, Poindexter, and two key members of the North network, retired Air Force major general Richard V. Secord and Albert Hakim, Secord's business partner.

President Reagan, the sources added, may be out of office before any trials begin. Walsh has what the courts have called "the heavy burden" of proving his evidence was derived from sources wholly independent of the immunized testimony given on Capitol Hill. Walsh has told colleagues that pretrial maneuvering after any indictment could take up to two years.

Walsh also is examining the actions of former national security adviser Robert C. McFarlane and other current or former top Reagan administration officials. This part of his probe centers on the issue of whether they misled Congress, especially about the administration's support of the "secret war" in Nicaragua during a two-year ban on most U.S. military aid to the contra rebels.

Attorney General Edwin Meese III was summoned before the Iran-contra grand jury last week, presumably to be questioned about the controversial weekend inquiry he conducted before his now-famous announcement last Nov. 25 that Iranian arms sale profits had been diverted to aid the contras. Meese is expected to resume testifying this week.

Expectations in Walsh's office and on Capitol Hill are that Walsh's inquiry will be more extensive and complete than the 11-month investigation by the House and Senate Iran-contra committees.

"They haven't gotten close to getting the whole story," a senior Walsh aide said of the congressional inquiry.

He said that while he is not familiar with the congressional testimony, he reached this conclusion because a number of witnesses interviewed by Walsh's investigators have said they were never contacted by the congressional investigators. "We're not going to prove whether it was a good or bad policy, that's not our mandate at all," the aide said. "But in terms of the criminal statutes, we will get to the bottom line."

Walsh's legendary thoroughness, spanning more than 50 years as a prosecutor, federal judge and Wall Street lawyer, has guided his Iran-contra inquiry.

So far, his staff has conducted more than 1,000 interviews, reviewed hundreds of thousands of documents from the White House, the Central Intelligence Agency and other federal agencies, and charted the flow of millions of dollars in Iranian arms profits from secret Swiss bank accounts to banks in the Caribbean and Central America.

Walsh has assembled the equivalent of a mid-sized law firm of 28 lawyers, supported by 20 Federal Bureau of Investigation agents and eight Internal Revenue Service investigators. The investigation has already cost more than $3.5 million, including offices rented for $87,293 a month in a downtown office building.

Security is a constant preoccupation. The office is rated a "Sensitive Compartmented Information Facility" (SCIF) because of all the top secret-codeword papers from the CIA, National Security Council and other agencies.

The combination of a four-digit lock on the double-doored entry is changed every week; the IBM word processors and Hewlett-Packard printers are costly "TEMPEST-approved" versions, with special shielding to prevent interception of faint electronic signals the machines generate. The document room is tantamount to being a large safe. And the security chief, FBI agent George Litzenberg, has a reputation for vigilance.

"We have a two-tiered trash system," said Geoffrey Stewart, an aide. "We have 'Business Trash' cans with white tape around them, and personal trash cans. I got upbraided by {Litzenberg} one day for throwing a coffee cup into a 'Business Trash' can. I also used to ball up paper before throwing it away. I got a memo saying, 'Do not ball up trash.' "

Walsh also has branch offices in federal buildings in New York, where six lawyers do legal research; and in Oklahoma City, where Walsh lives and works on weekends.

His staff includes a dozen former federal prosecutors with criminal trial experience (seven alone from the prestigious U.S. attorney's office in Manhattan) and civil lawyers from major New York and Washington law firms experienced in handling complex cases. There also is a sizable corps of young lawyers, most of whom graduated with honors.

The senior staff includes Keker, a respected trial lawyer from San Francisco, Paul L. Friedman; immediate past president of the D.C. bar; Guy M. Struve, a Walsh protege who is a partner in a major New York law firm, and K. Chris Todd, Robert N. Shwartz, and Audrey Strauss, veteran ex-federal prosecutors from New York. Struve, of Davis Polk & Wardwell, Walsh's old firm, knows better than anyone how Walsh thinks.

Several of the prosecutors tried journalism or writing first. Others set out to be teachers.

James A. Feldman was going to be a philosophy professor until he took a look at the academic job market. Louise R. Radin tried writing fiction. Laurence S. Shtasel worked as a radio station jazz programmer. Jeffrey R. Toobin has written for The New Republic. Clifford R. Sloan coauthored a study for the Twentieth Century Fund that recommended a new format for presidential television debates.

Some conservatives urged Reagan to pardon North and Poindexter before any charges are sought. White House officials have said the president would not give a preemptive pardon, but they have not ruled it out if either former aide is tried and convicted before Reagan leaves office.

Some lawyers question whether obstruction of justice charges can be brought if the activities allegedly covered up were not themselves crimes. They noted that the congressional ban cutting off most U.S. military aid to the contras, the Boland amendment, does not carry any criminal penalties.

In their congressional testimony, North and Poindexter foreshadowed a defense against possible criminal charges, particularly obstruction of justice.

North testified that he destroyed documents during his entire stint at the NSC. He and Poindexter said they were told Meese's weekend review was a "fact-finding inquiry," not a criminal investigation, and that Meese was acting during it as a political adviser to Reagan, not as attorney general.

In a speech last August, Walsh said, "Whatever prosecutions may be warranted will be brought, so that the courts may be given their opportunity to rule on the issues involved. There will be no short-circuiting of the investigation of the independent counsel. Only in this way can the rule of law be vindicated in this matter."

But Walsh's investigation is shadowed by a 1972 Supreme Court opinion, Kastigar v. U.S., that sets stiff rules for prosecutors in cases involving defendants who have received limited immunity.

In its Kastigar opinion, the high court held that the law "provides a sweeping proscription of any use, direct or indirect," by prosecutors of testimony from witnesses who received limited immunity, such as North and Poindexter. In underscoring the importance of the Fifth Amendment protections against self-incrimination, the judges wrote that the prosecution has "the affirmative duty to prove that the evidence it proposes to use is derived from a legitimate source wholly independent of the compelled testimony."

Wary of Kastigar, Walsh periodically submits sealed packets of evidence to Chief U.S. District Court Judge Aubrey E. Robinson Jr. here to show the material was obtained independent of any immunized testimony to Congress.

Walsh's concerns about the obstacle of immunized evidence were so great that he sought to delay as long as possible any congressional immunity grants to North, Poindexter, and others to give his own investigation more time to gather evidence before they testified publicly.

Walsh and his aides seriously considered seeking an indictment before North and Poindexter testified last July, then dropped the idea, sources said, in part because it would not have headed off contentious pretrial maneuvering over the immunity question.

A post-Kastigar ruling by the St. Louis-based 8th U.S. Circuit Court of Appeals imposed an even higher standard that suggests that a prosecutor's mere exposure to immunized testimony might be grounds for dismissal of criminal charges. The ruling is not binding in this judicial circuit and Walsh's aides disagree with it. But concerned that defense lawyers could cite it as precedent, they are attempting to adhere to its tougher standards.

Despite taking extraordinary precautions to insulate themselves from the 3 1/2 months of televised Iran-contra hearings, Walsh's staff had some accidents.

Walsh aide Struve recalled his alarm when on a visit to Central Park with his 5-year-old son a newspaper that had "something about Ollie in it" blew across their path. "You can't even walk in Central Park," Struve said later.

Even with the hearings completed, the only Iran-contra stories the staff are supposed to read are in daily news summaries by press officer James G. Wieghart, who censors stories that contain immunized testimony. He is one of a handful of "tainted" aides who were allowed to follow the hearings and act as intermediaries with the outside world.

Some defense lawyers involved in the investigation have said that Walsh's staff, in its effort to comply with the immunity restrictions, has created another problem: it has refused to consider immunized evidence from the congressional hearings that is helpful to those under investigation.

"They're telling the grand jury only one side of the story," said one attorney who has a client under investigation.

"It's whacko. We want to tell them what's exculpatory to our client and they won't listen to us," said a lawyer with a client under investigation.

Said another defense lawyer, "They have no constraints, no budget, no checks and balances. If you take enough time and resources, I'm not sure that anybody could withstand those resources."

When Walsh gathered his staff together for the first time early last January, he was operating out of borrowed office space in judges' chambers at the federal courthouse. The makeshift workspace lent a sense of urgency to the assignment.

"The air was charged with the feeling that this was a unique moment," recalled David Zornow, a former federal prosecutor from New York. "People had gathered from all across the country. We realized that we had a formidable task in front of us. When you start something like this you think back to other points in history, like Watergate."

In recruiting the staff, Walsh mostly tapped into his old contacts in major law firms and the federal judiciary. A chief recruiter was Robert Fiske, a former Manhattan U.S. attorney and now a partner at Davis Polk, where Walsh was a partner until he moved to Oklahoma City in 1981.

Some Washington defense lawyers have criticized Walsh for hiring few local lawyers who know their way around the courthouse here or are known to the local bar.

"You just have a little uncertainty that would not be there, if you're going to deal with someone you know," said a defense attorney.

Judith Hetherton, a veteran former prosecutor here, said she applied to Walsh's office after she noticed that initial selections were nearly all New Yorkers. "I felt they needed somebody from Washington," said Hetherton, who was hired.

Walsh said the lack of more Washington lawyers is not a serious problem. "Initially a strange lawyer in town is at a disadvantage," Walsh said. "But that goes away very quickly. You just try to get the best group you can quickly."

At the outset, Walsh divided his staff into teams: one for the White House and the NSC; one for the "money trail"; another for "CIA and private actors," such as Hakim and Secord.

Walsh's assistants said they are impressed by the vigor of their boss, 75.

"Judge Walsh knows a lot," said Stewart, a former deputy assistant U.S. attorney general. "He'll stun you. He'll come up at a staff meeting with an incredibly small detail and then another incredibly small detail."

Walsh's style is particularly evident at the usual weekly staff meetings each Tuesday morning, which a staff lawyer said resemble "a New England town meeting." They sometimes drag on into the evening, and, Walsh affirms, no one is bashful.

"People are not hesitant about expressing their views at all," said Sloan. "There's no doubt that Judge Walsh is the decision-maker. But he listens very carefully."

The congressional investigation found no "smoking gun" showing that Reagan knew of the diversion of Iranian arms profits, sources said, but Walsh's staff is seeking to establish its own evidence on that subject.

As one knowledgeable source put it, the question for Walsh still is: "How high does it go?"

Walsh refuses to discuss the matter.

North told the congressional Iran-contra committees that he acted with the approval of Poindexter, his boss. Poindexter testified that he authorized the diversion without informing the president.

Sources said that how diverted funds were spent is expected to be a central component of a broad conspiracy indictment Walsh is planning to seek.

"The money trail is the paramount evidence, everything else is secondary," said one source familiar with the Walsh inquiry.

Sources said Walsh is examining the newly acquired Swiss bank records in an effort to document possible misuse of profits from the sale of U.S. arms to Iran.

The congressional inquiry questioned such funds transfers as the nearly $500,000 that went to a Secord and Hakim firm; the $200,000 set aside as a death benefit fund for the North family, code-named the "Mrs. Bellybutton" account; and the nearly $14,000 used to install a security system at North's Great Falls house.

But criminal defense lawyers said that Walsh must first establish that the diverted Iran arms profits are in fact U.S. property before he can attempt to present evidence about possible funds misuse.

Secord and Hakim insisted in their congressional testimony that the profits were not government funds. Secord has denied profiting financially from the Iran-contra affair.

Despite suggestions from some conservatives that the Iran-contra affair amounted to no more than a wrong-headed set of policy initiatives, Walsh and his aides bristle at the idea that no crimes were committed.

They note that earlier this year, conservative fund-raiser Carl R. (Spitz) Channell and his business associate, Richard R. Miller, pleaded guilty to conspiring to defraud the government by soliciting contributions for military aid to the contras under the cover of a tax-exempt foundation. Channell and Miller said in court that their coconspirators included North "and others known and unknown."

"This isn't a case about ideology," said senior Walsh aide Michael R. Bromwich of the Iran-contra affair. "It's a case where crimes were committed. That's a matter of record."

The judges who appointed Walsh last December were aware that the case could drag on for years. The presiding member of the panel, Senior U.S. Circuit Judge George E. MacKinnon, said he estimated it would last "a couple of years" at least, and looked for a candidate with that in mind.

"We recognized that if the president knew about this {the commision of any crimes}, there was a possibility of impeachment . . . ," MacKinnon said.

Walsh can be expected to address Reagan's role, but he doesn't like hurry-up deadlines. He remains unfazed by criticism that he is moving too slowly or that the Iran-contra scandal may have faded from public view before he is done.

"You compare that with getting a just result," he said. "It just is not in the same ballpark. A just result is the best deterrent."

Staff researcher Michelle Hall contributed to this report.