When we specify precise information about a time of occurence for a single past event, or when we provide clear information about order, etc., with words like until, after, before, we generally use the simple past tense.
It is ok to use We were working until..., but not necessary and not as common as using the simple past tense.
We worked until 7pm last night.
The simple past tense is also our best choice when we are telling a story about the past. In particular, if we are using the verb to describe thinhs that happened in a series or chronology:
I watched TV until 8pm last night. Then I ate a snack, wrote some emails, and went to bed.