Is it better to prepare for CAT while working so as to have some work experience before MBA or preparing it alone?

As you are working you can just take the course material from any of the cochin like CL, TIME or IMS and start practicing that will help you a lot and at the same time you can also appear in the test series they are conducted mostly on sunday so you can easily manage your time too

I personally feel MBA is all about getting your managerial skill polished and getting more of industry exposure. Since you are already working this will be an add on during you placements after MBA so dont think of leaving your job till u get into sum college....
Mean while u can always practice at home with the help of study materials and appear in weekends test series conducted by IMS

well not necessarily u hav to prepare for it alone... u can always do the prep & job together bt do the practice consistently tat will help lot

CAT is little bit tough than MAT, So if u wants to prepare for CAT better go under some institutions