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Hi .. So I am in Karstaag Caverns doing the bonemold formula glover Mallory quest and Lydia couldn't make the jump across so I left her on a ledge and now when I circle back to her she is dead. Devasted. Not only is she my wife since beginning of game (I'm level 43) but a loyal and worthy companion. She is also carrying tons of treasure that I've collected the whole time in Solstheim and we've completed dragonborn and a bunch of other quests here. Is there anything I can do to revive her? I've already saved the game just before I knew she was dead.

You should have at least 3 Auto-save slots unless you have turned those off. Are you sure there isn't a single save where she is still alive?

I do see the 3 auto saves but they are from so long ago.. back when I was doing the black book miraak quest.. ugh. My only other save was when i reentered the room where she was on a ledge but when i got to her she was dead.

Since you play on the PS3 I'm afraid there's no way to revive her, legitimate or otherwise. You'll have to either go with it or restart from a while ago.

Ok I was afraid of that and did sort of anticipate that but was holding out for hope.
I think the game killed her because she could not jump from ledge nor scale back up? I thought she would respawn next to me at some point ?

Usually that is what happens, yeah. Followers can teleport through doors they can't access and stuff like that. However, Bethesda pathfinding is always kind of wonky, and with the added risk of teleportation it can be dangerous. The best thing you can do when you enter a dungeon that has dangerously inaccessible areas is to just tell your followers to wait. I always hesitate to rely on pathfinding when I have followers who I want to keep.

Also, as a general tip, save a lot always.

You could reanimate the corpse to get the treasure out of the cave, at least.

So i ended up getting Frea from Skaal village to follow me and assist in retrieving all the treasure from Lydia's body and hump it back to Raven Rock.

Maybe all is not lost. You can use the power of the elder scroll to go back in time and change her fate. However you will lose a lot of progress and have to defeat miraak again.